For today’s intraday charts menu, I’m serving up a couple of short-term chart patterns, with a rectangle on EUR/JPY and an ascending channel on GBP/JPY. Whoa! That means I’m serving up a yen + chart patterns double special today.
GBP/JPY’s recent price action has a rather noticeable downward tilt. And if we connect the most recent peaks and troughs, we can see that a fresh descending channel has formed on on GBP/JPY’s 1-hour chart.
And as y’all can see on that there chart, the pair is just about to test the channel’s resistance area, which should be at or just below the 148.50 minor psychological level. Y’all may therefore wanna get ready to start lookin’ for opportunities to go short.
And if we look at our technical indicators, we can see that them moving averages just recently crossed-over into downtrend mode. Stochastic, meanwhile, is already signaling overbought conditions and all that. The technical indicators are therefore in favor of further moves to the downside.
But as always, just keep in mind that there’s always a risk that the pair may continue to move higher and stage a topside breakout. And if such a scenario plays out, then y’all may wanna think about switching to a m,ore bullish bias if the pair validates the breakout by clearing 149.30.
And if you’re lookin’ to trade within the range, then heads up because the pair is making its way up after bouncing off the rectangle’s support area.
Do note, however, that stochastic is already signaling overbought conditions and all that. Also, them moving averages are currently in downtrend mode.
There’s therefore a higher-than-average chance for a downside rectangle breakout. And if that happens, then bears will likely be gunning for the next area of interest at 128.50.
Of course, there’s also always a chance that the pair may break to the topside instead. And if that happens, then them bulls will likely be shooting for 131.30.
In any case, y’all just remember to practice proper risk management as always, a’ight?