The wave pattern for the Pound/Dollar instrument looks more convincing after making adjustments, but still, there are several options for further developments. Thus, it is now impossible to give a definite answer to the question of where the instrument will go in the coming days. Earlier, I said that the wave pattern must be simple and understandable in order to make money on it. At the moment, nothing like that can be said about the wave counting. It provides several options at once. The key point is an unsuccessful attempt to break the previous low, which is now identified as at least waves 1 in 3 or c. However, it can also be the low of wave c in the structure wave a-b-c-d-e. It is possible to build a horizontal trend section, which always turns out to be very confusing in terms of wave counting. Thus, now the Pound/Dollar instrument does not look suitable for working with it at all.
The news background yesterday was focused on the speech of Fed Chairman Jerome Powell, who, as I said in the Euro/Dollar analysis, did not tell the markets anything new. In the UK, there was no news or reports at all either yesterday or today. But in the US, there were several publications today that deserve attention. Retail trade in March increased by 9.8% m/m, although the markets had expected growth of only 5.8%. The number of new applications for unemployment benefits amounted to 576,000, although the markets were expecting at least 700,000. Only the report on industrial production was below expectations and showed an increase of 1.4% against the forecast of 2.7%. However, in general, the package of statistics can still be called quite strong. This confirms the words of Jerome Powell about the high rates of economic recovery. Unfortunately, the markets are not yet making use of this information. If a new upward wave has now begun for the Euro/Dollar instrument, which can only be the first in a new upward set of waves, then for the Pound/Dollar it is now generally not clear what is happening, since the instrument quotes have been between 38.2% and 50.0% Fibonacci. Thus, the wave counting now has a clear priority over the news background, but this information does not help the sterling in any way.
At this time, the wave pattern is mixed, and I recommend waiting for its clarification so that at least a couple of possible options are eliminated, making it clear in which direction the movement will develop. A failed breakout of the April 12 low indicates that the markets are ready to build an upward wave. It can be used. But how strong this wave will be is impossible to understand now. A successful attempt to break through the 23.6% Fibonacci level could have helped determine the market sentiment, but it was already overcome once, and the upward wave was completed very quickly.
The part of the trend, originating on September 23, has taken on a five-wave fully completed form. Thus, this section of the trend is presumably completed, and the decline in quotes may resume as part of the construction of a new downward trend, the first two waves of which have already completed their construction. At the same time, the entire trend segment can be transformed into more complex structures.