The Bullish Pennant pattern suggests that the rally will continue

• GBP/MXN has formed a bullish Pennant pattern with an upside target in the 27.00s.
• The pair is in an uptrend in an ascending channel, with the odds favoring a higher continuation.

GBP/MXN formed a bullish Pennant continuation pattern during its uptrend in a rising channel.

The pattern indicates that a larger breakout would likely lead to substantial additional gains, possibly up to the upper channel line of the ascending channel.

GBP/MXN Daily Chart

The pennant likely started at the August 16 low, with a long streak of days in the second half of August comprising the “pole” of the pattern with the actual triangular “pennant” currently unfolding.

A break above the top of the pattern at 26.25 would confirm higher continuation to a conservative target at the 0.618 pole length ratio extrapolated above. This suggests a bullish target at 11/27.

The Relative Strength Index (RSI) momentum indicator is below the overbought level, suggesting that the pair has more upside potential before becoming overbought again.