23.03.202118:39 Forex Analysis & Reviews: Analysis of GBP/USD on March 23, 2021. Sterling shows desire to continue the decline

For the Pound/Dollar instrument, the wave pattern nevertheless suffered changes after the quotes made a successful attempt to break the low of the previous wave. Thus, at the moment, I consider the upward trend completed. If this is true, then the construction of a new downward trend section will continue. Its internal wave structure now suggests that waves 1 and 2 were built. Two unsuccessful attempts to break through the 161.8% Fibonacci level led to a resumption of the decline in quotes with the nearest target being around the 127.2% Fibonacci level. A successful attempt to break through this level will indicate that the markets are ready for further sales of the sterling and the formation of the third wave. I am not suggesting any other variants of wave counting now, but I admit that if an attempt to break through the 127.2% level is unsuccessful, the wave picture will get even more confused.

Today, the news background in the UK was very interesting. But what is the point in being interesting if it did not attract any attention from the markets? In the morning the UK unemployment report for January was released. Markets had expected to see either the last month's reading of 5.1% or an increase in the rate to 5.2%. However, instead of this, the value of unemployment dropped to 5.0%, and the sterling, at that time, began to decline. Of course, it can also be noted that wages in the UK in January grew slightly less than the markets expected, and the number of applications for unemployment benefits increased by 87,000 against the forecast of 7,000. However, I believe that with the same success you can interpret any report as you like. I believe that the most important report today was the unemployment report, but instead of the rise in the sterling, everyone saw it fall.

The speeches of the Governor of the Bank of England Andrew Bailey and the member of the monetary committee Andy Haldane also did not provide any important information to the markets. Haldane only noted that inflation in the future may be more difficult to control than it seems now. With the start of the performances of Janet Yellen and Jerome Powell, nothing on the market has changed. On the contrary, the activity even dropped somewhat. Thus, instead of an interesting day with a huge amount of important information from US and UK officials, we got a very boring day, trading within which was most likely based on technical or wave factors. That is, they had absolutely nothing to do with the news background.

Based on the analysis, I can conclude that now we should consider selling the instrument with targets around 1.3704. In case of a successful attempt to break through this mark, it will be possible to sell the instrument with targets located around the 35th figure for each new MACD signal "down". Tomorrow, the UK will release indicators of inflation and business activity in the service and manufacturing sectors. There will also be another talk by Jerome Powell and the US PMI. So, potentially, Wednesday can also be a very interesting day.

The part of the trend, originating on September 23, has taken on a five-wave fully completed form. But the internal wave structure of the supposed 5-5 wave still looks not entirely convincing and may require some additions and adjustments. At the moment, I consider the upward trend completed, so I expect the construction of a global three-wave downward trend.