06.05.202101:45 Forex Analysis & Reviews: Analysis of GBP/USD on May 5. Markets await Scotland's election results, but are unlikely to affect the pound

Such movements continue for the pound/dollar pair, which are very difficult to attribute to any particular wave pattern. For the last couple of days, the demand for the US currency has slightly increased, which allowed the instrument to decline. However, this downward movement does not fit into the current wave pattern, which suggests forming a new three downward waves. The whole movement after April 20 does not look like a new three down or at least the first wave of this structure. Thus, this section can take the form of wave d, and the construction of the upward section of the trend, which begins on March 25, will continue and take the form a-b-c-d-e. It should be recalled that the wave pattern should be as clear as possible, so that one can earn profit from it, which is clearly impossible to say about this instrument right now.

There was no news background for the pound/dollar pair on Tuesday, and it was quite weak the following day. No economic reports are currently being released in the United Kingdom, and statistics from the United States do not greatly affect the movement of the instrument. So, the instrument itself continues to trade in a very confusing way, which is clearly seen from the current wave pattern. For example, the markets did not react at all to the ADP report in the US. At the same time, even such an important topic as Scotland's parliamentary elections, it is not clear whether it has any effect on the British pound. At first glance, it can not help but have an impact, since the outcome of the election will depend on whether Scotland leaves the UK, causing it another strong blow after Brexit and the pandemic. There is no doubt that even if the parties calling for independence win the election, this does not mean that the referendum will take place at all. It is worth noting that the only legal way to hold a referendum is to get permission to hold it from Boris Johnson, who completely refuses to give it. This decision is justified by the fact that Scotland cannot hold a referendum whenever it pleases, every 5-10 years. However, judging by the mood of Nicola Sturgeon, she and her party will go all the way. In general, the pound is expected to come under market pressure if the Scottish National Party wins. However, it would be great if the wave pattern would become more readable. Trading on a bare news background is extremely difficult, as we never know exactly what the markets, which are a collection of many individual traders, will do on the day, and how long they will react to this or that factor.

Currently, the wave pattern continues to be confusing, so it is suggested to wait for the wave situation to clear up. There are at least several options for wave marking, each of which can be implemented in the coming weeks.

The downward trend section, which started to form a few months ago, is taking on a quite an unclear form. Based on the above-mentioned, several wave pattern 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 pattern to slightly clear up.