Every trader sees many market patterns everyday on every time frame. These market patterns all have precise trading entry levels and invalidation levels/stop loss levels. GBP/JPY on the 1 hour chart produced two market pattern breakouts towards the end of February 2018 signalling bears/sellers that the pair was going to extend and make newer lows.
GBPJPY 1 Hour Chart (Two Bearish Patterns)
The chart below clearly shows two market pattern breakouts. A Bearish Channel Pattern (Blue) and a Bearish Triangle Pattern (Green). On February 22, 2018 price broke out of the blue bearish Channel pattern triggering sells at the 149.02 level calling that momentum has now possibly changed to the downside. The pair broke lower but then bounced and corrected higher. But the movement higher did not have enough momentum to continue higher which then eventually formed the green bearish Triangle pattern.
On February 28, 2018 price broke below the green bearish Triangle and triggered sells at the 148.67 level and bears pushed the pair lower to newer lows. Both blue and green market patterns had precise entries and each had precise stop loss levels to invalidate the pattern. Any trader that was watching GBP/JPY could have traded either one of these market patterns and would have banked over +250 pips hitting the 2:1 RR targets.
Market Pattern Breakouts combined with an Elliott Wave forecast is a great trading strategy. As you will see below the Elliott Wave count we provided to our clients showed that GBP/JPY was going to move lower.
GBPJPY 1 Hour Chart February 20/2018 (New York Update)
On February 20, 2018 we advised clients that the pair will reverse lower after the next push higher towards the blue box area. After the reversal lower, all you as a trader had to do was wait for the blue Channel breakout lower to enter SELLS.
GBPJPY 1 Hour Chart February 28/2018 (Asia Update)
On February 28, 2018 we advised clients that the pair will continue lower. All you as a trader had to do was wait for the green Triangle breakout lower to enter SELLS.