For the pound/dollar instrument, the wave markup continues to look very convincing and does not require adjustments. The downward section of the trend continues its construction within the framework of the wave e-E, and its internal wave marking looks quite complicated. Nevertheless, I have identified five waves inside this wave and, if my markup is correct, then wave 5, the last internal wave, is being built at this time. Thus, we get almost identical wave markings for the British and the European, each of which indicates the possible imminent completion of the downward trend section. Or, everyone will have to take a much more complex and extended view than a weak news background or a complex geopolitical one can contribute to. The wave 5-e-E may already be completed, and an unsuccessful attempt to break through the 1.2245 mark, which corresponds to 127.2% Fibonacci, indirectly indicates this. The meetings of the Bank of England and the Fed resulted in a new decline in demand for the British dollar, although their results cannot be considered "positive only for the dollar." If the current wave marking does not become more complicated, then the decline in the British dollar may end during the current week.
The forecasts of the Bank of England are disappointing but do the British have the strength for a new fall.
The exchange rate of the pound/dollar instrument did not lose or gain a single base point on May 9. During the day, the instrument managed to decrease by 90, increase by 150 and decrease by 60. Thus, the amplitude of the movement was very high, despite Monday and the empty news background. However, the Briton still cannot cling to the construction of a new upward section of the trend. We are now at such a point in the wave marking that even wave 5-e-E can take on a more extended form, which will lead to an even greater decrease in the British. Thus, the departure of quotes from the reached lows by 100 points cannot be considered the beginning of the construction of a new upward trend section.
Last week, the Bank of England not only raised the interest rate but also made several disappointing forecasts. For example, inflation in the UK may rise this year not to 5.75%, as previously predicted, but to 10.25%. In 2023, the regulator expects a significant slowdown, up to 3.5%. And in 2024 - a decrease to 1.75%. Thus, British inflation may soon overtake even the American one, and the Bank of England will have to consider options with a new interest rate increase. Moreover, even several times during the current year. It is unclear whether the regulator expects a decrease in inflation in 2023 due to a strong rate increase or due to the cessation of rising oil and gas prices, as well as due to the restoration of logistics chains around the world? Because the Ukrainian-Russian conflict promises to be very long, which can support the growth of energy prices for a long time. Also, the whole world is now imposing sanctions against the Russian Federation, which sooner or later will begin to concern hydrocarbons, which will also spur prices for them. I believe that these forecasts are as "accurate" as the previous ones, according to which the maximum inflation this year was supposed to be 5.75%.
General conclusions.
The wave pattern of the pound/dollar instrument still suggests the imminent completion of the construction of wave E. Now I advise selling the instrument with targets located near the level of 1.1704, which corresponds to 161.8% Fibonacci, only in case of a successful attempt to break through the level of 1.2246. From my point of view, the construction of a downward section of the trend is nearing its completion and the mark of 1.2246 looks very good for the trend to end right around it.
At the higher scale, the entire downward trend section looks fully equipped. Therefore, the continuation of the decline of the instrument below the 22 figure is far from obvious. Wave E has taken a five-wave form and looks quite complete.
