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GBP/JPY binary signal - UK inflation data - 12 Dec 2017

Signal details
Entry Price: 
151.54
Close Price: 
151.18
Direction: 
High
Expiry Time: 
21:00 GMT
Result: 
OTM
How we trade
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The UK's Office for National Statistics (ONS) will be releasing the monthly inflation figures today for the month of November. According to the economists polled, inflation rate in the UK is forecast to have increased 3.0%, rising at the same pace as in October. Core CPI is also expected to have increased 2.7% on the month, same as in October.

Today's inflation data comes following the Bank of England's rate hike in November. The central bank hiked interest rates by 25 basis points in order to curb high levels of inflation amid weaker wage growth and slowing household consumption.

The inflation data for November also comes ahead of the BoE's monetary policy meeting this week. However, the central bank is expected to remain on the sidelines. Other data includes the PPI input which is expected to accelerate from 1.0% in October to 1.6% in November. The PPI output is expected to remain steady, rising at a pace of 0.2% during the month.

In the event that today's inflation continues to surge, the BoE will be in a dilemma which is likely to see the central bank announce further hawkish guidance. Last week, the Brexit negotiations managed a breakthrough as officials on both sides agreed to the Brexit bill. The next main hurdle is the UK's border with Ireland which has been a sticking point for the talks. However, another deal is expected which will bring more certainty to the Brexit talks.

Based on the above, today's forex binary signal is GBPJPY. The currency pair posted declines for two consecutive days. However, the bias remains to the upside as price action continues to consolidate near the top.

Therefore, we would purchase daily CALL options at 151.54 for 21:00 GMT expiry time. We expect that GBPJPY will breakout from the short term declines and close higher on the day.

binary options signal gbpjpy 12 Dec 2017

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.