GBP/USD slumps 150 pips on risk-off, attacks 1.4400

By FXStreet The GBP/USD pair halted its 2-day rally and reverted to the red zone in the European session, as risk-aversion was rife amid renewed weakness in the European indices.

GBP/USD drops more than 100-pips

The GBP/USD pair trades 0.71% lower at 1.4417, hovering within a striking distance of the 1.44 handle. Having peaked at 1.4564 levels in early Asia, the GBP/USD pair continues to inch lower, with selling pressure intensifying over the last hours as the European equities resumed the downtrend and sparked renewed risk-aversion wave across Europe. The UK’s FTSE drops -2.63%, while the pan-European benchmark, the Euro Stoxx slumps over -3.30%.

Markets are giving up higher-yielding currencies such as the GBP in favour of safe-haven assets like the yen, in a bid to protect their capital amid ongoing global sell-off. In the day ahead amid a lack of fundamental triggers, the oil price action and sentiment on the equities will drive the cable.

GBP/USD Levels to consider

The pair has an immediate resistance at 1.4496 (10-DMA), above which 1.4547/56 (Feb 8 High/ 50-DMA) would be tested. On the flip side, support is seen at 1.4400 (round number) below which it could extend losses to towards 1.4379 (20-DMA).
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Source:: FX Street