As y’all can see, the symmetrical triangle that we identified on GBP/USD’s 1-hour chart last Thursday finally broke to the upside. As y’all can also see, the pair broke higher while forming a new ascending channel. The pair is presently approaching the channel’s resistance area, though. Also, stochastic is already signalling overbought conditions. There is therefore a chance that the pair may retrace for a bit before climbing back up. Gangsta forex traders may be enticed to open a short-term short, but more conservative forex traders may want to wait either for a clear topside channel breakout or a rectracement to the channel’s support area before going long.
Next, we’ve got that there topside breakout from the ascending triangle on CAD/JPY that we discovered back on Wednesday. The breakout move lacked momentum at first, but it got a good boost today. However, the pair is approaching the 79.80 handle, which is an area of interest, even on the higher time frames, not to mention stochastic having reached overbought territory. As such, there’s a better-than-average chance that the pair may find resistance at 79.80. Of course, there’s also a chance that the pair could just eat up all the sell orders thrown at it and proceed to go higher, so prepare for that possibility as well, or at least make sure to practice proper risk management.
For our last stop on our trip down memory lane, we’ve got that there chart above. It looks kinda weird at first, but that’s actually the ascending triangle breakout from Tuesday. As y’all can see, there was a nice down-move before the pair found fresh buyers at 1.0350. The sellers were relentless, though, so a small descending triangle has formed. The basic way to play the triangle is to wait for a clear downside breakout. However, there’s also a chance that the bulls will gain the upper hand, given that the 1.0350 minor psychological level has strong market interest, even on the higher time frames. If that does happen, then the bulls will likely be gunning for the closest area of interest at 1.0470.
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To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis. Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.