GBP/JPY remains capped below 140.00 mark ahead of UK PMI

The GBP/JPY cross extended previous week's sharp recovery move from nearly 2-1/2 month lows and is now making a fresh attempt to move back above the 140.00 handle.

Spot gained fresh traction on Monday and the latest leg of up-move could be solely attributed to some renewed selling pressure around the Japanese Yen. Buoyant trading sentiment around equity markets, which tends to dent demand for traditional safe-haven assets, and a slight disappointment from Japanese Tankan Manufacturing Index have been key factors weighing on the Japanese Yen and collaborating to the mildly positive sentiment surrounding the cross on Monday. 

The momentum, however, lacked conviction amid some mild profit taking slide witnessed in the GBP/USD major as investors now look forward to the release of UK manufacturing PMI for March for fresh impetus. 

   •  When is UK manufacturing PMI and how could affect GBP/USD?

Looking at the broader picture, the cross has not been able to build on to previous recovery moves beyond 140.55-60 strong resistance since early March. Hence, it remains to be seen if the current leg of up-move can lift the cross through this key hurdle and open room for continuation of the near-term appreciating move. 

Technical levels to watch

Momentum above the 140.00 handle, might continue to confront strong resistance near 140.55-60 area, above which the cross seems all set to surpass 140.75 intermediate resistance and head towards reclaiming the 141.00 handle.

On the downside, retracement back below session lows support near 139.40-35 area is likely to drag the cross back towards 138.75-70 support before eventually dropping to its next important support near the 138.00 handle.