At this time, the wave pattern of the GBP/USD pair looks quite clear. The upward correctional section of the trend a-b-c-d-e is already done with its formation. Thus, the construction of the downward trend section is likely in process, which is still taking on a three-wave form. If this assumption is correct, then waves a and b have already ended, and the construction of wave c continues. In such conditions, the quotes will further decline to the targets located near the calculated level of 1.3640, which is equal to 38.2% Fibonacci. At the same time, the trend areas between February 23 and June 1 showed that the structures are currently quite complex, so any of them can transform into a more complex set of waves at any time. For example, the last upward section of the trend turned out to be five-wave. It is worth noting that the quotes' decline remains an option, but one should get ready for deep corrective waves.
The specified instrument lost about 10 basis points on Wednesday, but the nature of its movement remains unchanged. The pound's quotes are still in the stage of constructing a downward wave, while the news background supported only the US dollar. During the day, the UK published its GDP report for the first quarter in the final assessment. It turned out that the last estimate of the indicator is worse than the previous ones and GDP lost not 1.5%, but 1.6% in the first quarter. As a result, the pound came under pressure from the start. However, it should be noted that this did not lead to a strong decline in the quotes of the instrument. In general, the pound sterling traded quite calmly. On the other hand, the ADP report in the afternoon the came from the US also did not have much impact on the markets, although the EUR/USD pair lost about 30-40 basis points after its release. What's more strange was the pound's behavior since the entire news background on Wednesday was not in its favor. Moreover, we should remember that Britain is struggling with a difficult pandemic situation. If a week ago, the number of coronavirus cases approached the level of 20,000 per day, now, this figure has exceeded this mark. Consequently, the epidemiological situation is getting worse, and the markets can expect a deterioration in economic indicators because of this. In this case, everything will depend on the actions of the British government, which can extend the lifting of quarantine again. The current date is set for July 19, but Boris Johnson can postpone it to a later date. Perhaps, this may cause new sales for the pound, which will exactly correspond to the current wave pattern.
At the moment, the wave pattern has slightly cleared up. The presumed waves a and b are completed. Meanwhile, wave c is still under development, whose targets can be located at 100-150 points below the current levels. It is suggested to sell the instrument for each MACD signal with targets located around the level of 1.3640.
The upward section of the trend, which started to form a few months ago, has taken on a quite unclear form and has already been completed. However, the wave pattern still seems to be complex, as there is currently no impulse movement. It is presumed that the formation of a new, at least three-wave downward trend section has begun. Thus, we can expect the quotes to decline in the future to the lows of waves c and b.
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