GBP/JPY recovery capped below 144, UK PMI ahead

The cross in the GBP/JPY is seen struggling to extend the recovery from near 143 handle as we head into early Europe, as markets now look forward to the UK construction PMI report for fresh impetus.

GBP/JPY: Daily pivot – a tough nut to crack

Currently, GBP/JPY trades modestly flat at 143.74, unable to chew offers placed at daily pivot (143.83). The pound remains better bid against its Japanese peers in the early European morning, as the GBP bulls continue to cheer comments from the UK’s Brexit minister Davis delivered yesterday, which refueled hopes of a ‘Soft Brexit’. Mr. Davis noted that it was possible for the UK to maintain access to the European Union’s single market.

However, the recovery lacks follow-through on the back persisting weakness around USD/JPY, as the buck continues to correct lower against its main rivals ahead of the much-awaited US NFP report due later on Friday. In the meantime, focus remains on the UK construction sector activity report due later in the European session.

GBP/JPY Levels to consider    

The pair has an immediate resistance at 144.50 (psychological levels), above which 145.09 (daily R1) could be tested. On the flip side, support is seen at 142.93 (daily low) that at 142.39 (daily S1).