EUR/GBP clinches new weekly highs near 0.8750

• EUR/GBP moves higher to the vicinity of 0.8750 on Friday.
• GBP-selling is helping the cross on the upside.
• UK Manufacturing PMI dropped to 32.6 in April.

The correction lower in the sterling is allowing EUR/GBP to move to the area of weekly highs in the mid-0.8700s at the end of the week.

EUR/GBP stronger post-UK data

EUR/GBP is prolonging the erratic performance for yet another session, although it has managed to pick up further pace following the breakout of the key 200-day SMA at 0.8729.

The cross met extra buying pressure following the selling bias in the quid after market participants continue to assess the economic impact of the coronavirus on the economy as well as recent rumours that the government could extend the lockdown.

In the docket, the UK manufacturing PMI came in short of expectations at 32.6 in April (from 47.8) showing the increasing deterioration of the outlook amidst the coronavirus outbreak. Additional data saw the BoE’s M4 Money Supply expanding 2.8% MoM in March and Consumer Credit contracting £3.841 billion during the same period. Earlier in the session, house prices tracked by the Nationwide HPI rose 0.7% inter-month and 3.7% on a year earlier.

EUR/GBP key levels

The cross is gaining 0.58% at 0.8745 and faces the next resistance at 0.8863 (high Apr.6) seconded by 0.9019 (monthly high Oct.20 2019) and then 0.9324 (2019 high Aug.12). On the flip side, a drop below 0.8670 (monthly low Apr.30) would expose 0.8637 (100-day SMA) and then 0.8595 (monthly high Jan.14).