We suspect the EUR/GBP pair may be reaching the bottom of its recent downtrend, as risk sentiment may start to soften into key US data and the UK fiscal event’s impact on markets wears off.

We expect increasing support for the pair around 0.8650 and at the 0.8640 100-DMA. When it comes to Cable, our view is very similar to that of EUR/USD; the probability of a correction from these levels appears rather high.