I’m serving up another batch of short-term chart patterns in today’s intraday charts update. I’m mixing it up a bit, though, since I’ve got a channel on NZD/JPY and a triangle on GBP/CAD.
Okay, gonna keep it real with y’all. That there descending channel on NZD/JPY’s 1-hour chart ain’t really fresh since we first identified it way back on February 1 when the descending channel wasn’t yet verified.
Back then, the pair was milling about at 80.70 and we were expecting the pair to fall down to complete the channel.
And as y’all can see, the pair did go down and complete the channel. So if you were gangsta enough to short at 80.70 or thereabouts, then congratulations on bagging some delicious pips. Aww, yeah!
For today’s play, we’re lookin’ to go short again. And presently, the pair has already made its way down to the mid-channel area. Y’all therefore better decide quick if it’s still worth it to go short on the pair or not.
But if you prefer to trade more conservatively, then it would probably be safer to wait until the pair tests the channel’s resistance, which should be somewhere below 80.70. And there’s a chance that the pair may pull back up. After all, stochastic is already signaling oversold conditions and all that.
But if the pullback is deeper, so much so that the pair stages an upside channel breakout, then y’all may wanna think about bailing yo shorts, especially if the pair clears 81.30.
If you’re more of a breakout chartist, then check out that there symmetrical triangle on GBP/CAD’s 1-hour forex chart.
As y’all should know by now, a symmetrical triangle means that bulls and bears are fighting it out but neither side has a clear advantage over the other.
As such, the pair is just as likely to break to the upside as it is to move to the downside. And that means that we don’t really have a strong bias on the pair. In fact, it would even be wise to prepare for both upside and downside scenarios.
Whichever scenario plays out, the resulting rally or selloff will likely have enough momentum for a whopping 300-pip move.
Just note that an upside move needs to clear 1.7630 in order to validate the breakout. A downside break, meanwhile, needs to smash lower past 1.7310.
In any case, just make sure y’all practice proper risk management as always, a’ight?