The pound is losing value in the GBP/USD pair, holding near 1.3150 and local highs since October 30, updated last week. Market activity remains quite low as investors expect new drivers to emerge.

The GBP/USD pair is adjusting at 1. 3162 against macroeconomic reports from the UK: in September, gross domestic product (GDP) fell from 0.1% to –0.1% MoM and from a revised 1.2% to 1.1% YoY, and, according to preliminary data, from 0.3% to 0.1% and from 1.4% to 1.3% in the third quarter amid a slowdown in industrial production from 0.3% to –2.0% and from –0.5% to –2.5%, respectively. 

After falling to 1.3020 last week, the GBP/USD pair recovered to 1.3170 amid British macroeconomic statistics and the Bank of England’s monetary policy decision.

A fall is possible.

On the daily chart, the upward third wave of the highest level (3) develops, within which the first entry wave of the lowest level 1 of (3) ended, and the correctional second wave 2 of (3) develops. Now, the wave c of 2 is forming, the wave (iii) of c has developed, and the correctional wave (iv) of c is ending. If the assumption is correct, the GBP/USD pair will fall to the area of 1.2950–1.2750. In this scenario, the critical stop loss level is 1.3290.

The GBP/USD pair has been falling for the third month, trading at 1.3010 under pressure from expectations of significant tax increases in the autumn budget, which is due to be presented at the end of this month.