GBPUSD – Breakout of a pennant

GBPUSD – Breakout of a pennant

Prabjeet Singh
07 Nov 2019 06:24 PM
Analysing the daily chart of GBPUSD, we observe that the after a continuous rise in the pair, the rally has paused and there seems to be an indecision in the market. We can notice the formation of a pennant by the price action. A pennant is a continuation pattern in technical analysis formed when there is a large movement in prices, known as the flagpole, followed by a consolidation period with converging trend lines - the pennant. After the formation of a pennant, a breakout movement in the same direction as the initial large movement, which represents the second half of the flagpole. However, the price action has given a downside breakout.

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