GBY/JPY Trading in an Ascending Triangle

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GBY/JPY Trading in an Ascending Triangle

After making a new high on the year near 186, GBP/JPY has been consolidating. Let’s take a look at the structure of this consolidation to plan for a breakout.

There is an ascending triangle seen in the 1H chart, showing resistance around 186, and support at 184 then at 184.50-75. Today, price is making another bullish attempt but it seems to have stalled. If price can hold above 185.25, the bullish intent is still there and if this ends up breaking above 186.15, we can see another 200 pips or so higher (width of the consolidation range).

However, a break below 184.50 would signal further consolidation/bearish correction. Below 184.00, GBP/JPY might open up 200 pips lower, but we should limit our bearish outlook due to the weakness of the JPY and the prevailing uptrend in GBP/JPY, which is intact.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.