Yo! It’s a fresh week, so let’s start it right with a couple of fresh triangles on GBP/USD and EUR/USD that the breakout chartists out there may like.
First up in today’s intraday charts update is that there ascending triangle in GBP/USD’s 1-hour chart.
As the name implies, an ascending triangle is a bullish forex chart pattern so our initial directional bias is obviously to the upside. And our basic play is to wait for an opportunity to go long if an upside breakout past resistance at 1.3950 occurs.
And if the pair does stage an upside breakout, then the resulting rally will likely have enough “oomph” for a 200-pip move, based on the height of the pattern.
Do note, however, that there’s always a chance that the pair may break to the downside instead, so y’all may wanna prepare for such a scenario as well. And all the more so, given that stochastic has been signaling overbought conditions and all that.
And if a downside breakout does play out, then the pair will likely have enough for 200-pip move as well. Just keep in mind, though, that the pair needs to clear both 1.3820 and 1.3750 before the downside break is validated.
A triangle has also recently formed on EUR/USD’s 1-hour forex chart. This one’s a symmetrical triangle, though, so we don’t really have a strong directional bias on the pair. After all, a symmetrical triangle means that bulls and bears are locked in a game of tug-o-war, but neither side is really winning.
Anyhow, an upside breakout needs to take out the area of interest at 1.2320. Otherwise, the risk remains high that the breakout may end up being a fakeout. A downside breakout, meanwhile, needs to smash lower past 1.2160 in order to confirm the breakout.
In any case, just remember to practice proper risk management as always, a’ight?