FX.co ★ Analysis of GBP/USD on December 24

For the pound/dollar instrument, the wave markup continues to look quite convincing. The increase in quotes in the last few days suggests that the construction of wave D has begun after all. Also, the current increase in quotes can be interpreted as the first wave of a new upward trend segment. A three-wave structure is already visible inside this wave. If this is Wave D, then this may be the end of it for the Briton. If not, then the increase of the instrument will continue with the targets located around 36 and 38 figures. A successful attempt to break through the 50.0% Fibonacci level will indicate the readiness of the markets for further purchases, but the wave can still be interpreted as D. The instrument continues to move with the help of corrective structures, so at any moment the downward trend section may take a more complex form. Moreover, it is also possible to build a new downward wave for the euro.

Omicron leads to hospitalizations much less often than Delta.

The exchange rate of the pound/dollar instrument moved with an amplitude of 15 basis points during Friday. Thus, both instruments on Friday were already on weekends and holidays. As I have already said, Christmas will be celebrated all over the world tomorrow, so already today many banks and institutions were closed, and most of the market participants left ahead of schedule for the weekend. However, the Briton at the end of the year still managed to show that not everything is hopeless for it. Just like a European, next year, it may try to start building a new upward trend section. However, if the news background remains as weak as it is now, then another global downward wave is likely to be built. However, the British news background is still not as weak as the European. Let me remind you that the Bank of England did raise the interest rate in December, thus giving rise to the process of tightening monetary policy. If this action does not remain the only one in the coming months, then the pound will still have a chance to increase. The latest news on Omicron in the UK also gives reason to assume that everything will be fine. The first studies by the UK Health Safety Agency have shown that this strain causes hospitalizations in patients 50-70% less often than the Delta strain. Similar data came the other day from South Africa, Denmark, and Scotland. But at the same time, this strain is much more contagious than Delta, so the total number of hospitalizations may be the same as Delta or even higher. Everything will now depend on how fast the number of daily infections will grow.

General conclusions.

The wave pattern of the pound/dollar instrument looks quite convincing now. The supposed wave e could complete its construction. Thus, now I would advise buying a tool with targets located near the estimated mark of 1.3457, which corresponds to 50.0% Fibonacci, for each MACD signal "up". A successful attempt to break through this mark – and purchases can be saved with a target of 1.3641.

Senior schedule.

Starting from January 6, the construction of a downward trend section continues, which can turn out to be almost any size and any length. At this time, the proposed wave C may be nearing its completion (or completed). However, the entire downward section of the trend may lengthen and take the five-wave form A-B-C-D-E.