August 2nd, 2011: Wedge at GBP\JPY, +320 Pips at EUR\JPY

First of all I'd like to begin by showing you that the trade we have recommended on Friday has already progressed and reached its profit target which is +320 pips :)

Price has created a very accurate pullback to the lower trend line that was broken, and generated a very accurate reversal signal. Any traders that entered this trade would have taken a very profitable trade with amazing Risk:Reward ratio of 1:2.5. And the downward trend is still taking place .. So, we hope you took action and profited :)

At the daily chart of the GBP\JPY we can see that price is in a descending wedge chart pattern which is a strong reversal pattern.
Price usually hits a support level, and begins to reverse, ultimately breaking the wedge upwards. Inf tra the GBP\JPY Forex chart we can see that price has stopped once on the 124.00 support level and began to reverse, but now continuing the downtrend. In case price reaches this level again and stops again it may be a reversal signal. However these signals are usually not reliable so we will not trade them.
As you can see we aim to take only the most reliable signals like pullback or bounces, to make sure the quality of trades are the highest as possible.

The EUR\USD is bound between two converging trend lines. This is a sign of strong indecision in the markets. What we will usually do is to take long trades on the lower trend line and short trades on the upper trend line, however, here we are already past the 2/3 of the pattern so breakout is close.
Therefore we will not enter these trades and will wait for price to break one of the trend lines and then perform a pullback. In case of a pullback we will enter a trade in the direction of the breakout with tight stop loss and very high reward: 500 pips.
Good luck!