GBP/USD fell by 100 pips on Wednesday, hitting the lowest level in 6 weeks. Pound plunged to $1.6692 as British CBI realized sales dropped sharply. As a result, the market has tested the October 2013 channel support to the downside. On Thursday the cable has recovered some ground, returning into the $1.6740 area, but the market sentiment towards the pound still remains negative.
Market focus switched to the US GDP release at 12:30 GMT. According to market consensus, the Q1 GDP growth will be revised to the downside from +0.1% to -0.6%. If the figures are as disappointing as expected, the cable will get one more chance to retest the $1.6920/7000 resistance area this week. However, we still expect the $1.7000 mark to limit the upside of the pair. Support for the cable is seen at $1.6700, $1.6650 and $1.6580.
Chart. Daily GBP/USD