EUR/GBP plummets below mid-0.8600s, lowest since May 2017

   •  Dovish ECB outlook continues to take toll off the shared currency.
   •  Bearish set-up aggravates the selling pressure on Friday.

The EUR/GBP cross continued with its steep decline and tumbled to its lowest level since May 24 during the early European session.

The cross remained under some intense selling pressure for the second consecutive session on Friday and has now retreated over 100-pips over the past 24-hours. Thursday's ECB meeting minutes, revealing concerns over the sustainability of inflation was seen as one of the key factors behind the shared currency's relative underperformance against the British Pound.

The dovish outlook was further reaffirmed by the latest comments by the ECB Governing Council member Jan Smets, which kept exerting downward pressure on the cross. 

Today's downfall could further be attributed to some fresh technical selling following yesterday's bearish close below the very important 0.8700 handle, marking 61.8% Fibonacci retracement level of the 0.8313-0.9306 upsurge.

In absence of any major market moving economic releases, bulls are unlikely to gain any immediate respite and a follow-through weakness might continue dragging the cross lower on the last trading day of the week. 

Technical levels to watch

A subsequent drop below 0.8630-25 area is likely to accelerate the fall further towards the 0.8600 handle and any recovery attempt back above mid-0.8600s might now be capped at the important support break-point-turned resistance near the 0.8690-0.8700 region.