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
The wave markup on the lower chart does not look too convincing and clear. The rising wave 3 or C looks as if it has already completed its construction or, on the contrary, will take a very extended form. At the same time, an unsuccessful attempt to break through the 38.2% Fibonacci level suggests that the increase in the instrument's quotes will resume. The entire section of the trend starting on September 1 can take a w-x-y form. Thus, you need to be prepared for the complexity of the wave structure.
There is still some good news for the Pound. However, the US Dollar has only few good news. The Dollar still has the "election factor", but this article is not about it. For the pair, there are now two negotiation processes that are extremely important for the prospects of the instrument. In America, negotiations between Democrats and Republicans on a new assistance package for the American economy. In the UK, negotiations on a trade deal with the European Union are continuing. Both the former and the latter have an extremely low probability of success. For America, the problem is that the entire country is already focused on the election and there are insurmountable differences between Democrats and Republicans and between the Senate and Congress, about the size of the aid package. Thus, before the election, the probability of passing the bill is doubtful. After the election, news may focus on vote counting and court proceedings. Thus, I believe that during October and half of November, the American economy will continue to remain without stimulus. On the British side, the probability of success in the negotiations between Brussels and London is also doubtful. Though recently there has been information about some progress. However, there is no official information from the EU or UK governments. There are also no comments from the heads of the negotiating teams, Michel Barnier and David Frost. Therefore, I recommend that you treat any unverified information with caution.
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%, however, will indicate that the markets are not ready for new purchases of the British Pound. The entire wave marking may be transformed into 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.
