Sup, fam! I’ve got a couple of triangle patterns on AUD/JPY and EUR/USD that the breakout chartists out there may like.
AUD/JPY’s bullish push has stalled ever since it encountered resistance at 86.50. Bulls ain’t ready to call it quits, though, which is why the pair has been making higher lows.
And if we connect the most recent troughs and use 86.50 as one side, we can see that a fresh ascending triangle has formed.
As implied by the name, an ascending triangle is a bullish chart pattern. Our main directional bias is therefore to the upside. So y’all just be ready to start lookin’ for opportunities to go long should the pair break past 86.50 on strong bullish momentum.
Stochastic has just left overbought territory and the pair is already about to test one of the triangle’s sides, however. And the aforementioned side happens to be the support area. There’s therefore currently a chance that the pair may break to the downside instead.
If the pair does break to the downside, then smashing lower past the 86.00 major psychological level is the earliest sign that bears are winning out. The pair needs to also move lower past 85.70 before the breakout is validated, though, signaling a likely change in the trend in the process.
Looks like price action on EUR/USD is consolidating to a point since a symmetrical triangle has recently emerged.
And as most of y’all already know, a symmetrical triangle means that bulls and bears are roughly balanced, so the pair could break in either direction. It would therefore be prudent to prepare for both an upside breakout scenario, as well as a downside breakout scenario.
Looking at our technical indicators, however, we can see that them moving averages just recently crossed-over into uptrend mode, so an upside breakout seems like a more probable scenario. Stochastic is signaling overbought conditions and all that, though, so an upside breakout probably ain’t around the corner for now.
As for key price levels to watch before y’all can chillax after a breakout does occur, 1.1860 is the price area to watch for an upside breakout. A downside breakout, meanwhile, needs to smash lower past 1.1720.
In any case, just make sure to practice proper risk management as always, a’ight?