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GBP/JPY breach of daily channel support line

FXstreet.com (London) - The pound took a hit across the board earlier on with the release of lackluster readings in UK CPI coming in below consensus at 2.4% vrs expectation of 2.6%. This has compromised the ascending channel in the quote of April to the downside.

GBP/JPY had been drifting higher in an ascending channel, testing support along the way through to target the 156.75 zone until this release. The pair has now resumed a position much lower through 156.00 to currently trade at 155.61 and below the pivot. The quote has printed a new low on the session at 155.58.

We wait NA to decide its fate on the day ahead of BoJ, BoE minutes and Bernanke speaking in the afternoon. The pair could remain supported on dips in an overall weekly bull trend, supported 155.35 and 155.00 on weekly support lines. However, the daily channel support has been well and truly breached with bearish divergence.

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