For the pound/dollar instrument, the wave markup continues to look very convincing and does not require any additions. The assumed wave d-E is completed, and there should be five waves in total inside the wave E, respectively, as in the case of the euro/dollar instrument, the downward trend section can continue its construction for some time. The wave d-E can still take a longer, three-wave form. This is supported by the fact that wave b-E has taken a five-wave, extended form, as well as an unsuccessful (so far) attempt to break through the low wave c-E. However, taking into account the fact that the instrument has descended to the low of wave c-E, I think that wave d has completed its construction. If this is true, then the decline in quotes will continue, and a successful attempt to break through the 76.4% Fibonacci level indicates that the market is ready for new sales. In general, the wave pattern still looks very organic. I am not considering alternative options yet.
UK GDP slows down
The exchange rate of the pound/dollar instrument rose by literally 10 basis points on April 11, although the amplitude during the day was much stronger. However, Monday passed without incident. In the morning, a GDP report was released in the UK. It turned out that in February the economy grew by 0.1% m/m and 1.0% q/q. The market expected slightly higher values. Industrial production decreased by 0.6% m/m and grew by 1.6% y/y. And in this case, the market was waiting for higher values. The pound sterling fell by 20-30 basis points under the pressure of these statistics, but over the next few hours, it grew twice as much. Thus, nothing has changed for the Briton at the end of Monday.
A lot more important events will be the reports on inflation in Britain and the United States, which will be released tomorrow and the day after tomorrow. In both countries, a new increase in consumer price indices is expected, which should cause a tightening of the rhetoric of representatives of the Bank of England and the Fed. On the other hand, where to tighten it even more? Let me remind you that Andrew Bailey has already stated that the central bank is ready to raise the rate at least once more at the next meetings and admitted that there may be several increases during 2022, as inflation continues to rise. It's even easier at the Fed - they are going to raise the rate at every meeting until the end of the year, and in some cases, the increase may be 50 basis points. Both banks have taken a "hawkish" position and the only question is whose position will be stronger. So far, the Fed has more plans for the rate and its balance sheet, which they intend to reduce starting in May. Therefore, the dollar is still in high demand. And the more the geopolitical situation worsens, the more the pound may fall. At the same time, the downward trend is nearing its end. Even if it is built for a couple of months, it does not imply a decline in the British below the 27th figure. After its completion, at least a corrective, three-wave section of the trend should begin. That is, the British should grow by 600-700 points at least. But will the news background allow him to do this?
General conclusions
The wave pattern of the pound/dollar instrument still assumes the construction of wave E. I continue to advise selling the instrument with targets located around the 1.2676 mark, which corresponds to 100.0% Fibonacci, according to the MACD signals "down", since the wave e-E does not look complete yet.
At the higher scale, wave D looks complete, but the entire downward section of the trend does not. Therefore, in the coming weeks, I expect the decline of the instrument to continue with targets well below the low of wave C. Wave E should take a five-wave form, so I expect to see the quotes of the British near the 27th figure.