GBP/JPY â�,�“ GBP/JPY continues to fluctuate in a wide zone bound by 211.00 and 203.75.  We have focused on the recurring pattern of the pair making â�,��"its biggest one day gain or close to it on the last day of its rallyâ�,� (5/4 daily Technicals) before dropping off in a rush of selling.  This happened again last Thursday as the pair approached the 4/19 high at 210.78 before plummeting yet again.  The pair has rallied substantially today but has stalled at the confluence of the 20 day SMA / 38.2% fibo of 210.98-205.39 at 207.53/60.  As the range continues to contract within the large triangle, we can calculate when we would expect the pair to break out.  Projecting the lines from the triangle gives sets the apex at 8/24/2006.  The consolidation began after the high made on 12/12/2005 â�,�“ this is a difference of 8 months and 12 days.  Breakouts typically occur within between two-thirds to three-fourths of the way through the triangle.  This gives us dates for a potential breakout anywhere between 5 and one-third to 6 months after 12/12/2005 â�,�“ or 5/24/2006 to 6/12/2006.  Until then, the greatest probability is that GBP/JPY trades within the large triangle.

GBP/CHF â�,�“ GBP/CHF continues to trade within its large triangle as well but has significantly strengthened today taking out the past 9 weekâ�,��"�s highs before rejection at the 76.4% fibo of 2.3053-2.2446 at 2.2909.  The dealer chart shows a double top from the 3/24 and 5/11 highs at 2.2900.  Daily oscillators are bullish with CCI > 100 indicating that momentum is extreme but if the indicator falls below 100 then a turn to the downside is a definite possibility.  A daily close above the mentioned 2.2900, now initial resistance, would strengthen any bullish argument.  Support stems from the 23.6% and 38.2% fibos of 2.2449-2.2913 at 2.2804 and 2.2736.

GBP/AUD â�,�“ GBP/AUD also trades within a consolidation pattern, albeit a very tight one that began after the downtrend from 2.4843 to 2.3664.  Any intraday breaks above the upper line from the rising triangle near 2.4225 face resistance at the confluence of the 50% fibo of 2.4843-2.3664 / 5/9 high at 2.4253/80.  Any breaks below the line near 2.4075 encounter the confluence of the 50% fibo of 2.3667-2.4279 / 5/10 low at 2.3972.  This pair could break in either direction but momentum favors bulls as evidenced by RSI > 50 and positive MACD slope.  A bullish outlook is bolstered by the inverse head and shoulders (evident on hourly and dealer charts) as well as the fact that rising triangles (daily) are often bullish.  In any case, the tightening of the market presents superb risk to reward opportunities regardless of which way the pair breaks.

Jamie Saettele is a Technical Currency Analyst for FXCM.