For the pound/dollar instrument, the wave marking looks quite complicated at the moment but still does not require any clarification. We have a supposedly completed downward trend segment consisting of five waves a-b-c-d-e. If this is indeed the case, then the construction of a new upward trend section has begun. The first wave is supposedly completed, and the construction of wave 2 has begun. Unfortunately, there is no confidence in this particular scenario since the instrument must go beyond the peak of the last wave to show us its readiness to build an upward section of the trend and not complicate the downward one once again. The peak of the nearest wave is located at about 23 figures. Thus, even after the pound has increased by 1000 points, you need to go up another 1000 points to reach this peak. I also want to note that the wave markings of the euro and the pound are different now. Many have seen strong British growth in a short time, so they are "itching" to make purchases. However, let me remind you that even if the upward section has started building now, we should see a downward correction wave (after completing 1). If the quotes do not fall below the low wave e (which is very difficult, but not impossible), then you can also expect to build a new upward wave 3 and buy.
The reshuffle in the UK's top politics continues.
The exchange rate of the pound/dollar instrument decreased by 70 basis points on October 14. A day earlier, the instrument was trading with a very high amplitude, but at the same time, it was mainly growing. This is the difference from the movement of the euro currency. Yesterday's increase in quotes gave hope for the correctness of the current wave marking for the British, which, let me remind you, is radically different from the wave marking for the Europeans. As I have already said, one of the wave patterns will have to change since the pound and the euro is likely to continue to move similarly. But so far, I can't make adjustments to any of them since both instruments can continue to decline and increase from their current levels.
In the UK, just a couple of months ago, the prime minister and leader of the Conservative Party changed. Boris Johnson resigned, and a little earlier, several ministers resigned, thus showing their disagreement with Johnson's policy. However, Liz Truss came, and the situation did not improve. Kwasi Kwarteng became the new finance minister in her cabinet, but today several leading publications wrote that he would be dismissed. Let me remind you that Liz Truss announced a tax cut during the election. The corresponding plan was developed by Kwasi Kwarteng and was criticized by many economists and politicians. It seems that Truss decided to blame this plan on Kwarteng to deflect at least some of the criticism from herself. By the way, many tax initiatives have already been canceled. Today, Truss is scheduled to speak at a press conference, where she will probably announce the changes made to the "new economic plan" as well as the resignation of Kwarteng.
The wave pattern of the pound/dollar instrument implies the construction of a new upward trend segment. Thus, now I advise buying a tool for MACD reversals "up" with targets located above the peak of wave 1. Both buyers and sellers should be careful since it is unclear which wave markings (euro or pound) will require adjustments, and the news background may negatively affect both the euro and the pound. The decline within the corrective wave 2 may already have been completed.
The picture is very similar to the Euro/Dollar instrument at the higher wave scale. The same ascending wave does not fit the current wave pattern, the same five waves down after it. The downward section of the trend can turn out to be almost any length, but it may already be completed.