FXstreet.com (Barcelona) - The Pound is weakening sharply on Monday as the pair drops more than 100 pips, from an opening level right above 1.6500, the Pound has reached levels below 1.6350, and according to Karen Jone, technical analyst at Commerzbank, the Pound could drop further.

According to Jones, once below 1.6435 support, the Pound could drop to levels right above 1.6200: Loss of the 55 day ma support at 1.6435 should be enough to signal a slide to the base of the channel at 1.6212.

On the upside, Jones observes 1.6710/20 area to switch the pair's bias to the upside. Near term rallies are expected to find interim resistance at 1.6710/20 and while capped here, we will assume a neutral to negative bias very near term.