Sterling In Trouble as CPI Disappoints – Ready to Catch GBP/JPY Retracement?

During the London Open, investors were anxiously awaiting a big move from the UK’s CPI figures. The Office for National Statistics was expected to release a figure of 2.7%. However, the actual release came out as 2.5%, which is much lower than expected. The Sterling is slinking dramatically, giving us an opportunity to catch the retracement. 

GBP/JPY – Technical Outlook

The GBP/JPY is trading near 152.150 after falling more than 60 pips. The dip came in response to disappointing inflation data. At the moment, the Japanese cross has entered the massively oversold zone.

GBP/JPY – Hourly Chart

You can see in the chart above, GBP/JPY has come out of an ascending triangle pattern which supported the pair near 153.250. The immediate support prevails at 152.050. Considering the strong bearish candle, I think GBP/JPY will break below this support zone. The next support is likely to be 151.650. Above this, we can expect a slight retracement.

GBP/JPY –  Trading Plan

Let’s wait for the GBP/JPY to drop until 151.650. That’s the point I will take a buying position for a quick 50 pips. Good luck!