The wave pattern of the upward part of the trend, which began on March 20, is already completed, although the previous high resulted in the complication of the internal wave structure of wave Z. Thus, a decline in quotes will occur in the near future, targeting the 27th and 28th figures, thereby constructing a new downward trend.
Moreover, the current wave pattern shows that the upward trend, particularly wave Z, can be completed, since the quotes already left the reached highs. However, the demand for the US currency has been extremely low recently, and if it continues to be so, then wave 5 in c in Z may take on an even more complex and extended form. Thus, until the low of wave 4 breaks down, the upward trend may resume any time.
On another note, there was almost no news in the UK this week, since reports came out that Brussels and London failed to negotiate again. But there was a lot of news in the US. Today, the report on durable goods orders is higher, which was much better than what the market expected. The most important indicator in July grew by 11.2% against the forecasted + 4.3%. Thus, the demand for the US currency slightly rose.
So now, markets will wait for Jerome Powell to speak tomorrow at the symposium on Jackson Hole. No one knows what he will discuss, but given the current state of the US economy, his speech is unlikely to be optimistic. This speech will determine whether the demand for the dollar will fall on Thursday or whether the quotes will continue to move away from the reached highs.
Based on the current wave pattern, the quotes will continue to decline, so that the new downward trend will be implemented. However, this will not happen without market demand for the dollar.
General conclusions and recommendations:
Since the pound/dollar pair can completely build the upward wave Z immediately, I would not recommend setting up new buy deals. Moreover, selling the pair cannot be considered either. The US dollar is hardly growing, demand is very low, and the low of the previous wave 4 cannot be passed. Thus, it is unclear what the entire correctional wave will turn out to be and what form it will take.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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