06.05.202119:37 Forex Analysis & Reviews: Analysis of GBP/USD on May 6, 2021. Results of the Bank of England meeting came as no surprise

For the Pound/Dollar instrument, such movements continue, which are very difficult to attribute to any particular wave structure. I adhered to this opinion yesterday, and today's movements of the instrument are generally beyond comprehension. The meeting of the Bank of England is certainly an important event, and the markets really had the right to react violently to it. However, the pound sterling was jumping up and down like a flea during this time. Thus, the current wave counting has definitely not become clearer today. At any time, it may require corrections and additions. The movement of the instrument after April 20 does not look like a new three waves down, which I have been counting on for a while. This part of the trend is not like anything at all. And let me remind you that wave markings should be clear and simple so that you can trade the instrument and make money on it. This section can take the form of a wave d, but it is already noticeable now that this supposed wave d is completely different from waves a, b, or c. Thus, the wave counting is likely to get even more confusing.

The news background for the Pound/Dollar instrument was simply absent yesterday, and today, as I said, the results of the meeting of the Bank of England were summed up. However, I do not quite understand the panic in the market, when the demand for the sterling was either growing or decreasing, because the Bank of England, in fact, did not make any decisions or changes. The base rate remained at 0.1%, and the volume of the asset purchase program - at £895 billion. The decision was taken unanimously by all members of the monetary committee. The Bank of England also said in an accompanying statement that the prospects for the British economy remain uncertain due to the pandemic. GDP is recovering and inflation is growing, but this does not mean that such an effect will be observed over a long period of time. The Bank of England associates the latest growth in inflation and GDP with the abolition of quarantine restrictions in the UK. However, only the next quarters will show whether high inflation and good economic recovery will continue. And this will determine how long the Bank of England will keep its monetary policy super-soft. By the way, it is not entirely clear where the Bank of England saw high inflation and GDP. According to the latest statistics, GDP in the fourth quarter of 2020 amounted to 1.3%, and in the first quarter of 2021 will decline by 1.4%, according to forecasts. Inflation amounted to 0.7% y/y in March.

In addition to the Bank of England meeting, a report on business activity in the service sector was released in the UK this morning, which turned out to be slightly better than market expectations. Composite PMI also exceeded expectations, but the sterling at that time continued to wait for the results of the central bank meeting and did not react at all to these figures. In any case, all today's movements of the instrument have not clarified the current wave counting in any way.

At this time, the wave pattern continues to get confused, so I recommend waiting for the wave situation to clear up. There are at least several variants of wave counting, each of which can be implemented in the coming weeks.

The downward trend, which began its construction a couple of months ago, is taking on a rather ambiguous form. As I said above, several wave counting options are possible at once. Unfortunately, different options offer different further developments. Therefore, it may be necessary to wait for some time for the current wave counting to clear up a little.