FX.co ★ Wave analysis of GBP/USD for August 27. UK to face rising unemployment in September

The wave counting for the Pound/Dollar instrument still looks quite convincing at this time. Even though the proposed wave b turned out to be too deep, it still does not violate the wave counting. The exit of quotes from the lows reached in recent days indicates that wave b may already be completed. Thus, the markets still have the opportunity to build a three-wave upward structure. It will be possible to talk about an impulsive, five-wave section of the trend not earlier than a successful attempt to break through the level of 1.4239, which is the peak of the previous upward trend section. But a successful attempt to break through the lows of the last waves of b and e will indicate that the markets are not ready to buy the British pound. Thus, now I still expect to build at least one upward wave, which should go beyond the maximum of the expected wave a. In any other case, you will have to make adjustments to the current wave count. A lot can become clear today, as Jerome Powell's speech will take place, which the markets have been waiting for for two weeks.

The Pound/Dollar instrument moves without a certain direction on Friday. I believe that the markets are still focused exclusively on the Jackson Hole symposium, and they are not interested in all other news and events. Well, in any case, today we will be able to understand how Powell and the Fed are set up and what the markets will do in this regard. At the same time, there are no news and economic reports in the UK. But it became known that by October the country may face an increase in unemployment, since the state labor market support program will cease to operate on September 30. In other words, the state will stop paying workers up to 80% of their wages if they have lost their jobs due to the pandemic.

This means that hundreds of thousands of employees will be forced to look for a job. But at the same time, the number of vacant jobs has increased over the past year due to the outflow of migrants caused by Brexit, as well as the aging of the population. It turns out that there will be plenty of vacancies and labor force in search of work, too. The question is whether Britons will want to work in those jobs where migrants previously worked. In general, September-October may become a new shock for the UK economy, and it is still very difficult to assume what impact this factor will have on it.

The wave pattern is now more or less clear. I still expect the construction of an upward wave, so at this time, I suggest considering buying the instrument for each MACD signal "up" with targets located near the 1.4000 mark (the first target). The instrument has presumably completed the construction of the downward wave b and is ready to increase.

The upward section of the trend, which began its construction a couple of months ago, has taken a rather ambiguous form and has already been completed. A new section of the trend can get an impulse form, its first wave has acquired a sufficiently extended form and exceeded the peaks of waves b and d. The chances of a new strong increase in quotes are growing. If the news background does not interfere, then the increase in quotes should continue in the near future.