EUR/GBP sits near 4-week lows, around 0.8800 mark ahead of EZ CPI

   •  Drifts lower for the fourth consecutive session.
   •  Brexit optimism underpins British Pound.
   •  EZ CPI eyed for some respite for bulls. 

The EUR/GBP cross remained under some selling pressure for the fourth consecutive session, albeit now seems to have some support near the 0.8800 handle.

The British Pound continued with its Brexit optimism-led strong up-move and has been one of the key factors weighing on the cross. The market now seems to have started pricing in further progress on Brexit talks for a trade deal with the EU, with the cross retreating nearly 180-pips from weekly tops touched on Tuesday.

The selling bias now seems to have abated a bit, at least for the time being, as traders refrained to place aggressive bets ahead of the key Euro-zone inflation report, due later during the European trading session.

Moreover, a mildly positive tone around the EUR/USD major was also seen lending some support and helped the cross to hold its neck above the very important 200-day SMA support. 

Technical levels to watch

A convincing break below the 0.8800-0.8795 region (200-day SMA) might now turn the cross vulnerable to extend its near-term downslide towards early Nov. low support near 0.8735-30 zone.

On the upside, any recovery attempts might now confront fresh supply near the 0.8835 region, above which a bout of short-covering could lift the cross towards 0.8865 horizontal resistance.