USDJPY 1hr Bearish Triangle Formation
Updated
Take a look at the chart. USDJPY can be construed to be at the end of a horizontal triangle formation - prompting a negative breakout.
Normally with these patterns with a prior uptrend or impulse we have a bullish bias after the triangle breaks, but due to indications of bearish divergence and the strength of the bullish impulse leg (or legs), I believe the retracement we have all been waiting for is on the cards and is looking to travel back down. We may however, still be in the D leg of the triangle and will have to wait longer for such a move.
This retracement is looking to breakout of the price channel shown on the chart, forcing a move to the downside. This is a more short term move and my main concern is that price seems to have only a limited time to make a break before bulls re-enter and subsequently long the market.
Therefore if a break of the upper triangle trend is made, as it says on the chart, a view to take a short is then rendered invalid as the structure will have changed and will need to be reviewed again.
Normally with these patterns with a prior uptrend or impulse we have a bullish bias after the triangle breaks, but due to indications of bearish divergence and the strength of the bullish impulse leg (or legs), I believe the retracement we have all been waiting for is on the cards and is looking to travel back down. We may however, still be in the D leg of the triangle and will have to wait longer for such a move.
This retracement is looking to breakout of the price channel shown on the chart, forcing a move to the downside. This is a more short term move and my main concern is that price seems to have only a limited time to make a break before bulls re-enter and subsequently long the market.
Therefore if a break of the upper triangle trend is made, as it says on the chart, a view to take a short is then rendered invalid as the structure will have changed and will need to be reviewed again.
Trade active
Break to downside targeting 38.2% as first TP level around 102.9.
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