EUR/GBP 30 M Chart: Symmetrical triangle

Source: Dukascopy Bank SA
© Dukascopy Bank SA
While a symmetrical triangle pattern seems to signal a bearish environment for the pair, EUR/GBP is more likely to surge because of the strong bottom trend-line. The currency pair has developed an uptrend since mid-2015and it can be expected to continue after the triangle is broken. In the short-term, an upward breakout is more likely as well, although uncertainty emerges from the rate's current movements around the cluster of SMAs with Bollinger Bands in equal distances. In case of a breakout from the upper trend-line, the pair will rally to daily R1 at 0.8550, rebound from the broken level and surge towards the 0.8561 mark, represented by the daily R2 and 80 hour Bollinger Band. A downward breakout would initiate a dip to the daily S1 at 0.8529 and further to daily S2 at 0.8519 if tests are successful. While half-hour aggregate technical indicators remain neutral, the 15 minute and hourly gauge signals an uptrend, and the pair's proximity to the upper trend-line suggests that this just might be enough for an upward breakout to occur. A pessimistic SWFX sentiment (66% of positions short) just adds fuel to the claim in favour of an upward breakout.
© Dukascopy Bank SA
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