FXstreet.com (Barcelona) - A wave of renewed risk aversion on the back IMF downgrading global economic outlook and news that the UK debt management office revised its 2009/10 gilt issuance total up to GBP220 billion from previously estimated GBP180 billion, has produced a sell off of approximately 250 pips for the Pound.

GBP/USD has dropped from 1.4660 levels before the IF press release, to reach 1.4400, the lowest level since Apr 1 after news of the gilts issuance revision, to pick up slightly. At the moment, the Pound trades at 1.4440, 1.56% below its day opening price.

On a longer point of view, the Pound has lost all the ground taken on yesterday's rally and, according to Dimo Dimov, technical analyst at Karoll, the pair could suffer a sharp decline: W are currently in a correction of the fall started in the end of the last week. This correction still could reach a high above yesterday's 1.4708 however if my idea is correct, it should be limited to 1.4835 (61.8 % retracement of the fall started from 1.5065) and the expected sharp sell-off of at least 1000 pips should follow. A key support is 1.4466 and a fall below it will be a confirmation that the expected fall has begun. With an eye on these extremely bearish expectations I stay on my short position opened in the end of the last week.

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