Yo! If you’re a breakout chartist, then you may wanna check out today’s intraday charts update ‘coz I’m serving up a couple of triangles, with AUD/CAD and GBP/JPY in focus.
AUD/CAD’s price action appears to be tapering into a point, forming that there symmetrical triangle in the process.
A symmetrical triangle means that bulls and bears are fighting it out but neither side has a clear advantage. And that means that the pair is just as likely to stage an upside breakout as a downside breakout.
That also means that it would be prudent for y’all to prepare for both scenarios.
Looking at out technical indicators, however, we can see that them moving averages are still in downtrend mode. The 100 SMA even appears to be acting as dynamic resistance. Stochastic, meanwhile, is already signaling overbought conditions and all that.
In other words, our technical indicators appear to favor further moves to the downside.
Even so, it would still be for the best if y’all prepare for a possible topside breakout as well.
Also, do note that a downside breakout needs to smash lower past 0.9560 in order to validate the breakout move and lessen the chance for a possible fakeout.
As for a topside breakout, the pair needs to clear the area of interest at 0.9700 before y’all can kick back and chillax.
An ascending triangle has recently formed on GBP/JPY’s 1-hour chart. And as the name implies, an ascending triangle is a bullish chart pattern. We’re therefore mainly lookin’ to go long once the pair clears 149.20, ideally on strong bullish momentum.
And there’s currently a good chance that the pair may do just that since stochastic is already at oversold territory. Them moving averages, meanwhile, just recently crossed-over into uptrend mode.
Moreover, the pair is currently testing the area of interest at 148.20, which is another technical argument for support to form and for the pair to climb higher.
Do note, however, that the triangle formed after a downtrend. As such, there’s also a risk that the pair may stage a downside breakout instead.
Such a scenario is unlikely at the moment. But if such a scenario does play out, then a strong move lower past 148.20 would be an early sign that bears are taking over. The pair would need to also take out 147.20 before the downside break is confirmed, though.
Whichever scenario plays out, just make sure y’all remember to practice proper risk management as always, a’ight?