Wassup, dawg? If you’re looking for short-term breakout setups, then I’ve got your fix. To be more specific, I’ve got a bullish pennant on CAD/JPY and a triangle on GBP/AUD in today’s intraday charts update. Check ’em out!
GBP/AUD has been trading sideways for a while now. And if we connect the most recent peaks and troughs, we can see that the pair’s price action has been tapering into a point, forming that there symmetrical triangle.
A symmetrical triangle means that bulls and bears are fighting it out, but neither side has a clear advantage. However, one side will likely give way sooner or later, but bulls are just as likely to win as the bears. We therefore don’t have a strong directional bias on the pair.
But if a breakout does occur, then the resulting rally or sell-off would probably have enough steam for a whopping 500-pip run.
Just take note that a topside breakout needs to clear 1.8250, ideally on strong bullish momentum. A downside breakout, meanwhile, needs to smash lower past 1.7950. Otherwise, the risk remains high that the breakout may fail and end up being a fakeout.
As y’all can see, CAD/JPY recently surged higher, but encountered resistance at 89.20 and began milling about while tapering to a point. And in the process, a bullish pennant appears to have formed forming.
As it says on the tin, a bullish pennant is a bullish chart pattern. Our main directional bias is therefore to the upside. And we’re waiting for the pair to clear 89.20 on strong bullish momentum.
And if the pair does stage a topside breakout, then the resulting rally could potentially last for around 300 pips, based on the height of the pennant’s mast or staff.
With that said, there’s always a risk that the pair may break to the downside instead. So if the pair smashes past 88.50, then that likely means that bears are gunning for 86.20. And if bearish momentum is strong enough, y’all may even wanna consider switching to a more bearish bias.
In any case, y’all just remember to practice proper risk management as always, a’ight?