GBP/USD. Analysis for April 11th. Analysts are confused and do not know what to expect from the British pound
April 11, 2023 3:23 pm
The wave markup still looks complex for the pound/dollar pair and has undergone minor changes. Since the peak of the current upward wave has passed the peak of the last wave b, the entire downward trend segment, consisting of waves a-b-c, can be considered complete. Although it is very faintly similar to the trend segment for the same period in the euro currency, it should be acknowledged that both pairs have built descending three-wave sets of waves. If this assumption is correct, a new upward trend segment has begun for the pound. Since I can single out only one wave starting on March 8, there is every reason to assume that the rise of the British pound will be prolonged and strong. At the same time, it is quite difficult to say what will happen with the euro currency. Both pairs should build similar wave formations, but there have been problems lately. In the near future, wave b may already begin to form for the pound, after which the rise in quotes should resume with targets up to the 30-figure level. Unless wave c turns out to be the same as in the case of the descending set of waves. The background of the news needs to be clarified, and I would not rely solely on it for a strong rise in the British pound.
The dollar still needs to take advantage of its chances.
The pound/dollar pair’s rate rose by 50 basis points on Tuesday. After the demand for the dollar increased on Monday, I thought that the formation of the corrective wave b had already begun, but today shows that wave 1 or a can take a more extended form. In recent weeks, many analysts have expressed their opinions on the prospects of the British pound. These opinions differed radically, had dubious grounds, and changed over time. I now conclude that economists need help understanding what to expect from the British pound soon. On the one hand, the US economy currently shows much stronger results than the British one. And this should support the demand for the US currency. On the other hand, the Bank of England is expected to pursue a more aggressive monetary policy in 2023. On the third hand, the GBP/USD pair has been trading between the 1.1800 and 1.2440 marks for several months. Each wave during this period starts near one mark and ends near the other. Based on this, the first wave can end now, and the second wave – will end again near the 18-figure level. And if all these waves are considered a single whole, then a long-term sideways trend is formed, and the British pound and the US dollar are in equilibrium.
General conclusions.
The wave pattern of the pound/dollar pair suggests the completion of the downward trend segment. The wave markup is currently ambiguous, as is the news background. I do not see factors supporting the British pound in the long term, and now the formation of wave b may also begin. A decline in the pair is more likely now, as this is how the pair has moved in recent months. Trading can now be done from the 1.2440 mark, which corresponds to 0.0% Fibonacci. Below it – we sell; above it – we cautiously buy.
The picture resembles the euro/dollar pair on the older wave scale, but some differences remain. At this time, the ascending corrective trend segment is complete. But the three-wave descending segment may also be completed already. And the new ascending trend segment can also be three-wave or horizontal.
The material has been provided by InstaForex Company – www.instaforex.com
The wave markup still looks complex for the pound/dollar pair and has undergone minor changes. Since the peak of the current upward wave has passed the peak of the last wave b, the entire downward trend segment, consisting of waves a-b-c, can be considered complete. Although it is very faintly similar to the trend segment for the same period in the euro currency, it should be acknowledged that both pairs have built descending three-wave sets of waves. If this assumption is correct, a new upward trend segment has begun for the pound. Since I can single out only one wave starting on March 8, there is every reason to assume that the rise of the British pound will be prolonged and strong. At the same time, it is quite difficult to say what will happen with the euro currency. Both pairs should build similar wave formations, but there have been problems lately. In the near future, wave b may already begin to form for the pound, after which the rise in quotes should resume with targets up to the 30-figure level. Unless wave c turns out to be the same as in the case of the descending set of waves. The background of the news needs to be clarified, and I would not rely solely on it for a strong rise in the British pound.
The dollar still needs to take advantage of its chances.
The pound/dollar pair’s rate rose by 50 basis points on Tuesday. After the demand for the dollar increased on Monday, I thought that the formation of the corrective wave b had already begun, but today shows that wave 1 or a can take a more extended form. In recent weeks, many analysts have expressed their opinions on the prospects of the British pound. These opinions differed radically, had dubious grounds, and changed over time. I now conclude that economists need help understanding what to expect from the British pound soon. On the one hand, the US economy currently shows much stronger results than the British one. And this should support the demand for the US currency. On the other hand, the Bank of England is expected to pursue a more aggressive monetary policy in 2023. On the third hand, the GBP/USD pair has been trading between the 1.1800 and 1.2440 marks for several months. Each wave during this period starts near one mark and ends near the other. Based on this, the first wave can end now, and the second wave – will end again near the 18-figure level. And if all these waves are considered a single whole, then a long-term sideways trend is formed, and the British pound and the US dollar are in equilibrium.
General conclusions.
The wave pattern of the pound/dollar pair suggests the completion of the downward trend segment. The wave markup is currently ambiguous, as is the news background. I do not see factors supporting the British pound in the long term, and now the formation of wave b may also begin. A decline in the pair is more likely now, as this is how the pair has moved in recent months. Trading can now be done from the 1.2440 mark, which corresponds to 0.0% Fibonacci. Below it – we sell; above it – we cautiously buy.
The picture resembles the euro/dollar pair on the older wave scale, but some differences remain. At this time, the ascending corrective trend segment is complete. But the three-wave descending segment may also be completed already. And the new ascending trend segment can also be three-wave or horizontal.
The material has been provided by InstaForex Company – www.instaforex.com
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