The GBP/USD rallied during the 6/12 session, pushing to 1.6860 before finding intra-session resistance. This rally has broken above a falling wedge resistance shown in the 4H chart below.
The bullish breakout opens up the 1.6920 resistance pivot, as well as exposes the 2014-high at 1.6996. The 1.6780-1.6785 area could be important in the short-term. Upon a subsequent pullback, if traders hold cable above 1.6780, the bullish outlook can add confirmation. A break below 1.6780 however puts the focus back toward the 1.6740 support pivot, and the 1.6692 low. The current bullish continuation signal would be invalid, and the bearish consolidation/correction mode since the beginning of May would return into play.
GBP/JPY had a bullish breakout at the start of June. It was in a falling channel pattern since early May, so in a sense the consolidation/correction dynamic was the same, expect the bullish breakout occurred earlier. For the British pound-Japanese yen pair, it is at the confirmation phase after a pullback from 172.50 to 171.00.
The ability to hold above 171 is showing that the breakout may have shifted the mode back to bullish. Now that price is establishing support at 171, a break below this can put the focus back to a bearish consolidation/correction market. A break back above 172 can put the common high in the 173.40-50 area, as well as the 2014-high of 174.83 in sight.
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