The bulls were rescued by the rebound in the UK’s services sector activity report, allowing a minor recovery in the pound against the European currency.
GBP/JPY bounces-off five-month lows
The GBP/JPY pair trades -0.91% lower at 157.34, retreating from five-month lows reached at 156.81 pre-UK data release. The GBP/JPY cross found some respite from a better print of the UK services PMI and hence, aided the recovery in the prices from fresh multi-month troughs.
The overall bearish sentiment seen around GBP/JPY can be attributed mainly to the rising demand for the safe-haven yen as risk-off sentiment prevailed at full steam in the European markets.
Markets now look forward to the US session, with a string of US macro news on the cards, while the sentiment on the equities will be closely monitored.
GBP/JPY Levels to consider
The pair has an immediate resistance at 158.27 (1h 20-SMA) and from there to 158.76/79 (1h 50-SMA/ daily pivot). On the flip side, support is seen at 156.81 (daily low) below which it could extend losses to towards 156 (two-month low).
(Market News Provided by FXstreet)