HKD/JPY 4H Chart: Channel Up

The Hong Kong Dollar is trading against the Japanese Yen simultaneously in the medium-term descending and short-term ascending channels. However, the recent developments of the chart suggest that the dominant channel is transforming into the falling wedge and, in this way, the junior channel represents a rebound from the lower support line of the new formation. At the present moment, the pair is aiming to reach the upper trend-line of the senior channel. Since there are no barriers on its way, the rate is expected to achieve its goal. However, afterwards, a rebound most likely is going to follow. On the other hand, it is also possible that the pair will break through the upper boundary of the dominant channel and try to reach the 61.8% Fibonacci retracement level at the 14.33599 mark.