GBP/JPY weaker below 146.00 handle ahead of BOE

Having posted a session high level of 146.23, the GBP/JPY cross ran through some fresh offers and turned negative for the second consecutive session.

The cross extended previous session's retracement move from over 1-month highs, led by disappointing UK wage growth data, and was being weighed down by a modest pickup in safe-haven demand. 

The prevalent cautious environment, as depicted by a minor pullback in European equity markets, was seen benefitting the Japanese Yen's safe-haven appeal and is turning out to be an exclusive driver of the pair's movement through mid-European session.

Despite of the weaker trading sentiment, traders still seemed reluctant to place aggressive bearish bets in anticipation of a possible hawkish BoE tilt. Hence, the focus would be solely on the MPC voting configuration, which would eventually help determine the next leg of directional move.

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Technical levels to watch

A follow through weakness below mid-145.00s could drag the cross below the key 145.00 psychological mark towards its next support near the 144.75-70 region.

On the flip side, sustained move back above the 146.00 handle, leading to a subsequent break through 146.30-35 hurdle, could pave way for continuation of the pair’s upward trajectory towards the 147.00 handle.