CHF/JPY 1H Chart: Rising Wedge

After bottoming out near the low of 106.80, the Swiss Franc started a robust recovery against the Japanese Yen that resulted in a rally of more than 300 pips.

Previously we supposed that CHF/JPY has been fluctuating between two parallel trading lines. However, now, with more candlesticks to examine, it appears to be more likely that the currency pair has been forming a rising wedge pattern. If this turns out to be the case, then the lower boundary of the pattern has just been breached, implying that there is a good chance that the exchange rate will start moving towards the 200-hour SMA at 108.49.