EUR/GBP eases from multi-month high after UK CPI

After hitting a fresh post-Brexit high, the EUR/GBP cross erases all of its daily gains and turned back below 0.8700 handle following the release of UK data.

According to the report released by the Office for National Statistics (ONS), UK CPI for July rose 0.6% y-o-y, which was a tad above consensus estimate and June's 0.5%. Meanwhile, the core CPI matched expectations and eased to 1.3% in July. 

Today's UK economic releases provided a much needed respite to the British Pound, which has remained under intense selling pressure on expectations of aggressive monetary easing by the Bank of England. 

Meanwhile, strong bid tone surrounding the EUR/USD major has restricted further downslide for the cross as markets now look forward to the release of ZEW economic sentiment from the Euro-zone.

Technical levels to watch

On the downside, 0.8640 level seems to act as immediate support, which is followed by support at 0.8600 round figure mark. A convincing break below 0.8600 handle is likely to trigger a near-term corrective move for the cross, towards its next major support near 0.8500 psychological mark. 

Meanwhile on the upside, momentum back above 0.8700 handle, and a subsequent move above multi-month high resistance near 0.8725 should open room for continuation of pair's ongoing bullish momentum.