GBP/JPY firmer, 140.00 on sight ahead of BoE

The bearish tone surrounding the Japanese yen has given extra oxygen to GBP/JPY, currently posting daily highs near the key barrier at 140.00.

GBP/JPY now looks to BoE

The recent upside in the cross will surely be put to the test later in the session, as the BoE is expected to deliver a dovish tone, including the likeliness of a 25 bp cut to the benchmark rate.

In the meantime, the cross has eroded yesterday’s pullback and keeps the rally alive since last week’s multi-year lows in the 128.80 region, all amidst prevailing risk-on sentiment, extra stimulus in Japan and GBP recovery.

GBP/JPY key levels

As the moment the cross is up 1.78% at 139.76 and a break above 140. (psychological level) would expose 140.78 (38.2% Fibo of post-Brexit down move) and finally 150.56 (55-day sma). On the other hand, the next support lines up at 128.77 (2016 low Jul.6) ahead of 125.63 (monthly low Nov.2012) and then 124.68 (monthly low Oct.2012).