The wave analysis for the GBP/USD pair remains quite complex. For several months in a row, we have observed movements between Fibonacci levels of 50.0% and 23.6%. Horizontal movement is not the best for wave analysis. As I have already noted, the wave pattern should be simple and understandable to work with. At the moment, there is little simplicity and clarity in it. If the presumed wave 2 or b is indeed completed, then the construction of the expected wave 3 or c has begun. However, there are many doubts about this scenario because the market is currently in another sideways movement.

Moreover, only the British pound is stuck in this sideways movement. The euro, which usually trades similarly 80% of the time, is in the process of building a downward trend section. From this fact alone, we can understand that something is wrong with the British pound. If this is visible to the naked eye, therefore, trading the pound is associated with increased risks. In the current situation, my readers can only hope for the construction of wave 3 or c, the targets of which are located below the low of wave 1 or a. Therefore, the pound should decline by another minimum of 600 basis points.

The British pound itself needs help understanding where to go.

The GBP/USD pair rate decreased by 50 basis points on Friday. Such a decrease in the pair (even though the day has not yet ended) looks like a mockery of common sense. Throughout the week, there were no strong and important statistics in the UK, while from the US, we received predominantly positive news (ADP, JOLTS, and ISM reports). In addition to this, Powell's speech was expected to cause an increase in demand for the dollar, and today, on Friday, it became known that the unemployment rate in the US decreased from 3.9% to 3.8%, and the Nonfarm Payrolls number reached 303 thousand, which exceeded the market's expectations by 1.5 times. And all the market could do was increase the dollar by 50 points. One hopes that by the end of the day, the American currency will add at least another 50.

However, such movements have little practical sense for the US dollar. The sideways movement for the GBP/USD pair has persisted for several months, and above the 1.25 figure, the price can move however it wants. This still won't lead to the end of the sideways movement. Only this week, the US currency missed several opportunities to break through the 1.25 figure and finally start building a downward wave 3 or c. But even in a week with such a strong news background for the dollar, the market found no reason to buy it. The theater of the absurd continues.

General conclusions.

The wave pattern of the GBP/USD pair still suggests a decline. At the moment, I am still considering selling the pair with targets below the 1.2039 mark, as wave 3 or c will sooner or later develop. However, as long as wave 2 or b is not completed with 100% certainty, we can expect an increase in the pair up to the 1.3140 mark, which corresponds to 100.0% according to Fibonacci. The retreat from the recent peaks is still too small to be confident at the beginning of the construction of wave 3 or c.

On a larger wave scale, the wave pattern is even more eloquent. The downward corrective trend section continues its construction, and its second wave has acquired an extended form - at 76.4% from the first wave. An unsuccessful attempt to break through this mark could have led to the beginning of the construction of 3 or c.

The main principles of my analysis:

1. Wave structures should be simple and understandable. Complex structures are difficult to play with; they often bring changes.
2. If there is confidence in what is happening in the market, it is better to avoid entering it.
3. There is never 100% certainty about the direction of movement. Don't forget about Stop Loss orders for protection.
4. Wave analysis can be combined with other types of analysis and trading strategies.