Whether you like trading ranges or waiting for breakouts, these consolidation patterns on USD/CAD and GBP/USD are worth looking at!
Watch how the pairs react to these inflection points:
GBP/USD: 4-hour
GBP/USD 4-hour Forex Chart
Cable has formed lower highs and found support around the 1.3000 mark, creating a descending triangle on its 4-hour time frame.
Price is inching closer to testing the triangle support, which might still hold as a floor. After all, Stochastic is already indicating oversold conditions or exhaustion among sellers.Once the oscillator pulls higher, pound bulls could take this as their cue to bring GBP/USD back up to the resistance at 1.3100. If you’re counting on this to happen, watch out for reversal candlesticks around the support zone.
Just be careful since the 100 SMA is below the 200 SMA to signal that there’s a chance the floor might break. If that happens, the pair could tumble by the same height as the triangle pattern, which spans a little over 400 pips.
USD/CAD: 4-hour
USD/CAD 4-hour Forex Chart
Looks like the mid-range area of interest is holdin’ for this one!
USD/CAD has been moving sideways between support around the 1.2450 minor psychological mark and resistance at the 1.2850 handle, but the middle of its range is proving to be a strong barrier as well.Will sellers return right here? Or can we see a move back up to the top?
Technical indicators seem to be favoring the former, with the 100 SMA below the 200 SMA and Stochastic turning lower from the overbought zone. These both indicate that bearish pressure is present, which means that another dip to the bottom of the range is possible.
At the same time, the 200 SMA is holding as dynamic resistance right at the support-turned-resistance area. A break above this 1.2650 minor psychological level, however, might clear the way for a climb to the top!
