EUR/GBP well-offered for second straight session

The EUR/GBP cross extended Friday's rejection move from the key 0.85 psychological mark and has now slipped below mid-0.8400s to a 4-day low level. 

With the pro-EU centrist Emmanuel Macron's victory in the second round of the French presidential elections fully priced-in, the post-Macron profit taking slide in the shared currency has been a key factor driving the cross lower for the second consecutive session. 

EUR/USD extends post-Macron profit-taking slide from yearly tops

Meanwhile, the cross has now reversed 50% of last week's tepid recovery gains and has also broken below 200-SMA (1-hourly) support near 0.8460-55 region. Hence, a follow through selling pressure and a subsequent drop below the 0.8400 handle, ahead of the BoE's super Thursday, still remains a distinct possibility. 

On the economic data front, market seems to have largely ignored the upbeat release of German factory orders data and a slight disappointment from UK Halifax HPI, while reemergence of selling pressure, following Friday's reversal from near 1-1/2 week tops, clearly suggesting that the near-term bearish pressure might still be far from over. 

Technical levels to watch

Immediate support is pegged near 0.8425 level, below which the cross is likely to head back towards the 0.8400 handle before eventually dropping to fill last week's bullish gap towards testing 0.8375 support.

On the upside, any recovery attempts beyond 0.8460 immediate resistance might continue to confront strong supply near the 0.8500 handle, above which a bout of short-covering has the potential to lift the cross towards 0.8525-30 strong hurdle.