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GBP/JPY binary signal - UK Retail sales - 19 Oct 2017

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Entry Price: 
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Expiry Time: 
20:00 GMT
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The UK retail sales data for the month of September is expected to be released today at 08:30 GMT by the UK's Office for National Statistics (ONS). According to the economists polled, the retail sales data in the UK is forecast to decline 0.1% on the month. This comes following a strong performance in the month of August. Retail sales were seen rising 1.0% on the month which topped expectations of a 0.2% increase.

On a year over year basis, the UK retail sales data is expected to rise 2.1%, slightly easing from the 2.4% increase posted the month before. Excluding gasoline, retail sales are forecast to decline 0.2% on the month and 2.2% on the year.

In August, the UK's retail sales posted a strong rebound as data suggested a rebound in the economy. This came as sales at petrol stations fell and demand for food shopping stayed flat. Most of the gains in the retail sales increase in August came from non-essential items. The data was upbeat with the previous month of July also seeing some upward revisions.

However, the data for September is likely to disappoint. Recent data showed that consumer prices reached a five-year high at 3%. This was a full basis point higher than the Bank of England's 2% inflation target rate.
Central bankers have been looking at hiking interest rates and given the recent uptick in inflation, the Bank of England is expected to act when it meets in November. This could potentially put further squeeze on the UK's household incomes.

Despite a moderate increase, wages in the nation continue to lag behind inflation which is expected to result in lower spending and consumption. Added to this a rate hike would further tighten demand and could keep shoppers at bay.

Based on the above, today's forex binary signal is GBPJPY. The currency pair managed to recover from the 148.23 support level and in the process formed an ascending wedge pattern. Therefore, we are looking to purchase daily CALL options at 148.70 for a 20:00 GMT expiry time. We expect GBPJPY to post a pullback to 148.70 before the currency pair continues to close higher on the day.

binary options signal gbpjpy 19 oct 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. 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. All risks and coasts associated with online trading are your responsibility.