GBP/JPY retreats from a multi-year high, experiencing selling pressure on Tuesday that snaps a five-day winning streak. The pair reached its highest level since August 2015 near 191.30 but now trades around mid-190.00s.

Slightly softer-than-expected Japanese inflation figures in January fuel speculation that the Bank of Japan (BoJ) could move away from its negative interest rate policy. This, coupled with expectations of Japanese government intervention to boost the Yen, strengthens the JPY and triggers profit-taking in the GBP/JPY pair. Additionally, the British Pound’s (GBP) relative weakness compared to the JPY stems from bets that the Bank of England (BoE) may soon initiate interest rate cuts, supported by softer UK inflation data released last week. However, a generally weaker US Dollar benefits the GBP, potentially limiting losses for GBP/JPY.

This fundamental backdrop makes it cautious to assume a near-term top for the GBP/JPY cross. Traders may await further selling confirmation before entering significant short positions. Overbought oscillators on the daily chart could initiate some profit-taking, supporting the case for additional intraday losses.