GBP/USD back below 200-DMA, what next?

By FXStreet FXStreet (Mumbai) – The GBP/USD sprint came to a halt at a high of 1.5388, after which the spot fell back to trade below its 200-DMA at 1.5352.

Focus on stocks and M&A news

The Sterling has been buoyed by the uptick in the major European equities. The London’s FTSE index is up 1% in the early session. Meanwhile, Merger and Acquisition (M&A) news also support Sterling. According to reports, Tesco’s is said to be selling its South Korean business, Mitsui Sumitomo Insurance has eyes set on UK’s Amlin and Zurich Insurance is after RBS.

With no major data due, the focus is likely to be on the risk sentiment in the markets. The M&A moves in Sterling usually last for a day and are followed by a countermove in the following sessions. It remains to be seen if the Sterling manages to sustain M&A gains this time or resumes the downtrend.

GBP/USD Technical Levels

The spot currently trades around 1.5345. The immediate resistance is located at 1.5352 (200-DMA), followed by a major resistance at 1.54. On the other hand, support is seen at 1.5317 (23.6% 1.5819-1.5162) and Friday’s low of 1.5162.
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Source:: FX Street