I’ve got not one, but TWO swing trade opportunities on the docket today, brothas! Are you seeing the same forex trend and breakout patterns on GBP/JPY and NZD/JPY?
As you can see, GBP/JPY dropped to the 143.50 levels after its rally stalled around the 148.85 area.
What makes the retracement more interesting is that the pair is forming what looks like a bullish pennant on the 4-hour time frame. And as the School of Pipsology teaches us, pennants like these tend to signal trend continuation.
A break above the pattern could push the pair to revisit its previous highs just below 149.00, if not hit its 2016 areas of interest near 152.00 – 162.00. A downside break, on the other hand, could drag the pair back to the 142.00 zone.
Is NZD/JPY over its downtrend? As you can see above, a falling trend line has not only been broken, but has served as resistance on the 4-hour chart. Twice. What’s more, the 100 SMA has also just crossed the 200 SMA!
Right now, the pair is providing a countertrend trade opportunity by retesting a rising channel resistance while stochastic is chillin’ in the overbought territory.
You can take advantage of some short-term selling if you’re one of them countertrend traders, but you can also wait for a bit of weakness and jump in at a better price if you’re interested on trading this new uptrend.