GBP/JPY rebounds from 130.00 handle ahead of UK retail sales

Despite of yesterday's reversal from 131.80 and a subsequent weakness during early Asian session on Thursday, the GBP/JPY cross has managed to hold and bounce-off 130.00 psychological mark to currently trade around 130.40-50 range.

Strong bid tone surrounding the Japanese Yen, primarily led by dovish FOMC meeting minutes, has weighed on the cross that failed to benefit from Wednesday's release of upbeat UK jobs report. On Wednesday, the pair did extend its recovery from Tuesday's multi-week low to hit a fresh weekly high but lost its upside momentum and erased all of its early gains to retrace back to 130.00 handle. 

Meanwhile, cautiousness surrounding equity markets is driving investors towards traditional safe-haven currency, Yen, and has kept the cross suppressed ahead of the release of UK monthly sales data, scheduled for release during European session. 

Technical levels to watch

A sustained break below 130.00 handle now seems to trigger a fresh leg of weakness for the cross initially towards Tuesday's low support near 129.00 region and eventually towards testing a short-term descending trend-channel support near 127.00 area in the near-term.

On the flip side, 131.00 round figure mark now become immediate hurdle, which if conquered is likely to boost the pair beyond 132.00 round figure mark, towards testing its next major resistance near 132.50 area. A follow through buying interest has the potential to continue boosting the pair towards its next major resistance near 133.50-60 region.