Apparently, the wave pattern of the GBP/USD pair has cleared up. An increase in quotes on Tuesday has led to an update of the high of the expected wave e, so now, this wave no longer looks like an e. In this case, the entire wave pattern may need adjustments and additions in the very near future. It can be recalled that the wave pattern does not look unambiguous and can develop in several ways at once. At this time, it is important to understand exactly how the further movement of the instrument will take place. So far, it looks as if the instrument has built a downward section of the trend a-b-c-d-e in February-March of this year, after which the construction of a new impulse section of the trend has begun and its third wave is currently being built. However, even in this case, the internal wave structure does not look clear, and even a successful attempt to break the high of the expected wave 5 in 5 in 5 will not add clarity to the current wave pattern. Therefore, any trading of the instrument now looks risky, although the general upward trend of the GBP/USD pair continues.
The news background on Tuesday was quite favorable for the pound. First, the UK lifted part of the quarantine measures this Monday, which will contribute to the growth of economic and business activity, as well as economic growth. Secondly, the economic reports that was recently published also showed that Britain's economic situation is improving. In particular, the unemployment rate declined from 4.9% to 4.8%, while average earnings rose by 4.0% including premiums and 4.6% excluding it. At the same time, the number of applications for unemployment benefits fell by 15.1 thousand, against the market's forecasted growth of 25.6 thousand. However, there is doubt that this particular statistic is the reason for the continued increase in demand for the pound because the euro was currently rising, and the pound has been growing for a long time without any statistics. Nevertheless, these reports had an additional impact on the GBP/USD pair, which only helped the pound to further strengthen its positions.
The Governor of the Bank of England, Andrew Bailey, and Deputy Governors Ben Broadbent and Sir David Ramsden are still expected to make a speech. So, it is possible that the market will learn some new information, which will also affect the rate of this instrument. In general, the pound continues to have excellent prospects, as the wave pattern, although not very clear on a smaller scale, clearly shows the formation of a new upward trend on a bigger scale.
The wave pattern continues to be very confusing, so it is suggested to wait for it to clear up. There are at least several options for wave pattern, each of which can be implemented in the coming weeks. Now, the upward wave continues to form, but its internal wave structure does not allow making an unambiguous conclusion about how extended will it be and where it can end.
The upward section of the trend, which started to form several months ago, is taking on a quite unclear form. It was mentioned above that several wave patterns options are possible at once. Unfortunately, different options offer different further developments. Therefore, it may be necessary to wait for some time for the current wave pattern to slightly clear up.
