GBPCAD – Rally resting, for now

Like GBPUSD, Sterling had a strong rally against the Canadian Dollar recently. But the pair is now going through a correction.
Given the strength of GBP’s January advance, the latest correction does not appear large enough to warrant the view that the Sterling rebound is completely over.
The question then is: How far will the rate correct? A 50% retracement of the 1.68-1.76 rally will see support at 1.72, about 200 points below current levels. This is possible, given the growing uncertainty associated with Sterling due to Brexit.
In the week ahead, CAD will report GDP (Wed) and Manufacturing PMI (Thurs).