The wave counting for the Pound/Dollar instrument looks as similar as possible to the wave counting of the Euro/Dollar instrument. It can be assumed that all recent movements of both instruments were formed based on the same news background and factors. That is why we are now observing a three-wave set for the Pound/Dollar, which could have already ended since the instrument has moved away from its lows by 160 basis points since Friday. Thus, the supposed wave c may already be completed, and the wave a, as in the case of the Euro/Dollar instrument, turned out to be very extended and practically unreadable if we talk about its internal structure. Also, today's reversal of both instruments downwards at exactly 10:00 UTC speaks in favor of the similarity of the factors affecting both instruments recently. It is noteworthy that at this time there were no important events on the calendar. Especially in the USA, since it is logical to assume that since both instruments began to fall simultaneously, the reasons lie in the dollar.
The Pound/Dollar instrument first gained 60 basis points on Tuesday, and then lost about 65. However, the news background was as unattractive and ambiguous for the pound as it was for the euro. PMI for the construction sector was released in the UK in the morning, which turned out to be better than the markets expected, amounting to 66.3 points. However, by that time, the pound had already stopped rising and headed down. The same applies to American reports, among which I also want to highlight the business activity indices. The PMI for the services sector fell from 64.8 to 64.6 points, and the ISM business activity index fell from 64.0 to 60.1 points. It was the second index that could have caused a decline in the dollar, but this did not happen.
So what do we have? For the euro, more than half of the reports did not coincide with the movement and did not correspond to it. For the pound, the same thing: when interesting data came out, the instrument was already turning in the opposite direction and was moving completely out of line with the economic data. Therefore, I can only state that the reports themselves, which came out during the day, were not the most important for the markets. By and large, all PMI indices remained at fairly high values, as it is believed that a value below 50.0 points is a turning point, below which there is a decline in business activity. Nevertheless, the published PMI indices showed a value of at least 60 points. Monday's European PMI was no less than 58 points.
At this time, the wave pattern has cleared up a bit. The supposed waves a and b are completed, but wave c can also be completed. Given the high degree of similarity with the Euro/Dollar instrument, one can expect an increase in quotes, however, the pound did not make an unsuccessful attempt to break through an important level. Thus, I recommend buying an instrument with targets located above wave b for each signal of the MACD indicator "up", but do it very carefully and constantly pay attention to the euro.
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 difficult, as there is no impulse movement now. At this time, presumably, the construction of the downward part of the trend continues, so we can expect a decline in quotes to the lows of waves c and b in the future. At the same time, wave c could be shortened and already completed.
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