In the most global terms, the construction of a new downward section of the trend continues. The continued decline in quotes suggests the completion of the construction of wave 2 or b as part of this section, which, therefore, has taken a rather shortened form. A successful attempt to break through the minimum of the expected wave 1 or a allows us to conclude that the markets are ready for further sales of the GBP/USD. The chart clearly shows the drop in demand for the pound sterling in recent weeks, which is caused by a whole list of different reasons and factors.

Over the past trading day, the GBP/USD instrument gained several basis points. Thus, the construction of a new downward section of the trend continues within the expected wave 3 or C, since the minimum increase in the instrument cannot violate the current wave marking. An unsuccessful attempt to break through the level of 61.8% suggests that the markets are ready for a small departure of quotes from the lows reached.

So far the pound has made a small success in its attempt to recover. According to the latest news from the UK, it is quite difficult to rely on a strong increase in the price of the pound sterling. At the same time, no currency can move in one direction all the time. The second correction wave turned out to be quite weak, so now there are actually quite a large number of options for further development of events. Thus, it is possible to conclude that the upward section of the trend is really complete. And the grounds are quite simple. Right now, UK goes not just at the edge of a precipice called "Brexit no bargain", but it already walks on the edge of a precipice called "the Quarrel with the EU."

Representatives of the European Union have already stated that the actions arranged by London are lawlessness, as well as weak attempts to intimidate. This simply means, no one in the European Union believed Boris Johnson and is not going to make concessions to him in the negotiations.

The official position of the EU is clearly seen in the comments of its representatives. If London wants to violate international law and the agreement with the EU, let it go. Brussels will go to court with this, impose sanctions on Britain, which will already be drained of blood by leaving the bloc, and may eventually start its own trade war.

It is unlikely that Europe will simply agree with Johnson's desire to violate the current agreement, and even such an important and principled one. For the European Union, Northern Ireland is a window that needs to be closed to avoid illegal movements of people from Britain to its territory, to avoid the flow of contraband in both directions. The mechanism stipulated in the agreement seems to satisfy both sides, but in the end, Boris Johnson is going to violate this agreement. Or at least he says he's going to.

General conclusions and recommendations:

The Pound-Dollar instrument presumably completed the construction of the upward trend section. At the same time, there is a high probability of building a correction wave 2 or b, which could also have already completed its construction near the level of 38.2%. An unsuccessful attempt to break this mark allows the markets to start selling the instrument with targets located around 1.2721 and 1.2539. Based on the construction of the third wave, this is equal to 61.8% and 76.4% Fibonacci.