Wave analysis of GBP/USD for July 9. UK GDP lags behind forecast by half

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The wave counting for the Pound/Dollar instrument looks very similar to the wave counting on the Euro/Dollar instrument, but there are still some differences. The supposed wave c for the Pound/Dollar instrument can also be completed and can take on a more complex and extended form. An increase in the quotes of the instrument on Friday is currently about 40 basis points. However, before going beyond the previous local peak of July 6, I do not recommend buying the instrument. The euro and the pound are now moving very similarly, and in both cases, it is necessary to wait for confirmation of the completion of the downward wave c. I would like to remind you once again that the wave counting of the Pound/Dollar is very ambiguous, but the lack of a successful attempt to minimize the expected wave c (at the moment) indirectly indicates the possible completion of the construction of the descending set of waves.

The Pound/Dollar instrument could fall victim several times on Friday. In the morning, news began coming in from the UK that could only upset the markets and nothing else. Early in the morning, it became known that the number of coronavirus cases in Britain is not dropping below 32,000 for two consecutive days. Let me remind you that this daily value of cases is only two times lower than the maximum for the last year and a half, that is, for the entire time of the pandemic. But last fall, the UK government introduced a "lockdown" on such figures, and now it wants to completely cancel the quarantine and allow its citizens not to adhere to the rules of distancing and wearing masks. There is something to think about, given that the UK is again the first in Europe in terms of the number of new cases per day.

In addition, the economic statistics were not encouraging either. GDP in May grew by only 0.8% MoM, which is two times lower than the value that the markets expected to see. Industrial production in Britain rose only 0.8% in May, which is also below forecasts. And Andrew Bailey did not say anything important during his speech. Thus, personally, I believe that there are again economic and epidemiological problems in the UK, no matter what the representatives of the Bank of England and the government may say. GDP is growing slowly, the country is on the verge of the fourth wave of the epidemic, Brexit, according to many experts, will negatively affect the economy for a long time to come. Thus, the pound seems to have all the necessary reasons to continue to decline. But wave counting shouldn't be ignored either. It can overlap the news background.

At this time, the wave pattern has become a little clearer. The assumed waves a and b are completed, and wave c can both end and become more complex. Thus, I recommend now selling the instrument again with targets located around 1.3645, which corresponds to 38.2% Fibonacci, for each MACD downward signal. If the instrument makes a successful attempt to break through the peak of July 6, it will indirectly mean the completion of the construction of wave c.

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The upward part of the trend, which began its construction a couple of months ago, has taken on a rather ambiguous form and has already been completed. However, the wave counting still looks rather complicated, as there is no impulse movement now. At this time, presumably, the construction of a downward trend section continues, so we can expect a decline in quotes in the future to the lows of waves c and b.

The material has been provided by InstaForex Company - www.instaforex.com

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