GBP/JPY steady near 2-month lows

GBP/JPY is falling modestly on Tuesday, headed toward the fifth decline in a row. It has been able to hold above last week lows but the recovery remains limited and the bearish pressure persists. 

Today the pair bottomed at 140.04 and then bounced modestly to the upside. It is trading at 140.35/40, less than 20 pips down for the day. Since late Friday, GBP/JPY is moving in a consolidation range between 140.00 and 141.00. 

The pound remains weak in the market. Last week was among the worst performers. Today the pair avoid a sharper decline thanks to a lower demand for the yen. The Japanese currency was affected by a risk appetite, that boosted equity prices in Wall Street and pushed US yields to the upside. The Dow Jones was up 0.65% while the 10-year bond yield rose to 2.21%. 

Levels to watch 

To the upside, immediate resistance is seen at 140.50/55, followed by 141.00/05 (daily high) and 141.20 (Aug 11 low). On the flip side, support might lie at 140.00/05 (daily low), 139.75/80 (last week low) and 139.50 (Jun 9 low).