EUR/GBP near 0.8950 on Merkal coalition, Italian election

• Italian elections set for a hung parliament, 5-Star Movement takes a slight lead.
• Angela Merkel's successful coalition formation buoying Euro to start the week.

The EUR/GBP sprung upwards to start the trading week but failed to capture any new territory, still trading underneath Friday's high and currently testing 0.8940.

The Euro gained some bullish favor over the weekend following Angela Merkel's successful formation of a coalition government between her own CDU/CSU and the SPD party. Pro-coalition votes took over 66%, with 78.3% of total SPD members voting on the initiative. Merkel's new cabinet will be formed next week.

Meanwhile, Italian elections promise to stir things up as markets digest the results, with Silvio Berlusconi's far-right coalition and the anti-establishment 5-Star Movement set to battle it out, with neither side capturing the 40% requirement for a majority government in Italy. 

UK Prime Minister Theresa May outlined her Brexit strategy in a speech on Friday, but many questions remain as the leader of the UK's ruling conservative party danced around the inevitability of a firm separation between the UK and the European Union (EU) markets. 

EUR/GBP Technicals

The Euro has managed to push up high enough against the Pound to hit a three-month high, and Daily charts see a heavy consolidation range barring the way to the 0.9000 handle. Volatility is the hallmark of the pair, with H4 charts highlighting the pair's twitchy nature. Intraday levels can be found at 0.8910 and 0.8870 for support, with resistance forming a zone from 0.8965 to 0.9010.