In the most global terms, the construction of the expected new upward section of the trend continues. Its internal wave marking does not look very convincing at the moment, but the section of the trend that begins on September 23 can hardly belong to the descending wave structure that has been formed since September 1. Thus, most likely, this is a new ascending global wave, which can take a three or five wave form. It may be part of the uptrend from March 20, or it may be an uptrend correction wave as part of a new downtrend from September 1.
The wave markup on the lower chart does not look too convincing and clear. Given the very short-term increase in the instrument's quotes after the completion of wave 2 or b, we can assume that the upward wave will either take a very extended form, or it has already been completed. In the first case, the British will clearly need the help of the news background to continue the increase, in the second one, most likely, the current wave markup will become more confusing. An unsuccessful attempt to break the 38.2% Fibonacci mark still keeps the markets in an upward mood, which leaves hopes for building an upward trend section.
There is still very little positive news for the British. The good thing is that there is not much news that can stir up the market. The Pound / Dollar is moving in a very calm mode and wave patterns are now more important than the news background. There is no news on the most important topic for the British. The negotiations are going on and on and on. According to reports from various sources, there is and there is no progress. Sometimes both sides say that they should prepare for Brexit without an agreement, then they call for intensifying negotiations in order to try to conclude a deal. In General, there is a lot of information and no specifics. Therefore, I would now recommend starting from the 38.2% Fibonacci level. If the quotes of the instrument remain above it, then wave 3 or C will continue its construction. It doesn't matter when or if London and Brussels come to an agreement there. A successful attempt to break through the 38.2% level will indicate that the markets are not ready for new purchases and will complicate the current wave marking. This is the least attractive option.
There are no economic reports that will be published in the UK this week. If in America and in the EU there will be reports on GDP for the third quarter on inflation and an ECB meeting, there will be nothing like this planned in the UK this week. Thus, markets will have to find factors to trade in one direction or another. Either way look only in the direction of the American news background.
General conclusions and recommendations:
The Pound-Dollar instrument has presumably completed the construction of a downtrend section. A successful attempt to break through the level of 38.2% will indicate that the markets are not ready for new purchases of the British dollar, and the entire wave marking may be transformed to a more complex one with the transition to building a new downward wave. Thus, if the 1.3013 mark is broken, I would recommend selling the instrument with targets located near the estimated 1.2867 mark, which corresponds to 50.0% Fibonacci based on the beginning of building a new downward wave. Until this happens, you can consider buying with a target of 1.3189.
