The Bank of England meeting will reveal the central bank's decisions. The market does not expect significant changes. The main question boils down to whether the BoE or Governor Andrew Bailey will personally signal a dovish stance. What kind of signals could these be? If there are any, demand for the British currency may fall, which is what we need for the current wave analysis. Therefore, it is important to understand what to expect from the BoE and the market.

So, the first signal could be in the form of an increase in the number of Committee members voting for monetary policy easing. In the recent meetings, only one out of nine policymakers supported a rate cut. Now, with UK inflation already close to 3%, the number of members who support the rate cut may increase, which would automatically bring the central bank closer to a rate cut and the pound to a new decline.

The second signal could be Bailey's rhetoric, which may be softer compared to previous meetings. Bailey may announce that inflation is slowing down, according to the Bank's forecasts. Such a statement would immediately imply that the rate could begin to decrease in late summer or early autumn. In addition, Bailey may openly inform the market that the central bank is considering a rate cut in the near future. Both of these statements are likely to put pressure on the pound.

However, there is also a possibility that Bailey and the entire BoE will adopt a wait-and-see approach and refrain from making promises and announcing statements lightly. After all, some policymakers have stated in the past month that inflation may stabilize and fluctuate for some time. If official figures mention this, it means there are reasonable doubts about consumer prices maintaining a downward trajectory. In this case, we won't hear any dovish rhetoric, and demand for the pound will depend on what the market comes up with. Even in the case of absolutely neutral rhetoric, the market will draw certain conclusions. And it's hard to imagine what they will be. Overall, I still expect the instrument to fall so I advise you to consider selling.

Wave analysis for EUR/USD:

Based on the conducted analysis of EUR/USD, I conclude that a bearish wave set is being formed. Waves 2 or b and 2 in 3 or c are complete, so in the near future, I expect an impulsive downward wave 3 in 3 or c to form with a significant decline in the instrument. I am considering short positions with targets near the 1.0462 mark, as the news background works in the dollar's favor. A successful attempt to break 1.0787, which is equal to 76.4% Fibonacci, will indicate that the market is ready for new short positions.

Wave analysis for GBP/USD:

The wave pattern of the GBP/USD instrument suggests a decline. I am considering selling the instrument with targets below the 1.2039 level, because I believe that wave 3 or c has started to form. A successful attempt to break 1.2472, which corresponds to 50.0% Fibonacci, indicates that the market is ready to build a descending wave. An unsuccessful attempt at 1.2625, which equates to 38.2% Fibonacci, would indicate that an internal, corrective wave of 3 or c, is complete.

Key principles of my analysis:

Wave structures should be simple and understandable. Complex structures are difficult to work with, and they often bring changes.

If you are not confident about the market's movement, it would be better not to enter it.

We cannot guarantee the direction of movement. Don't forget about Stop Loss orders.

Wave analysis can be combined with other types of analysis and trading strategies.