GBP/JPY holding on to its gains above 140.00 handle

Strong UK employment report assisted the GBP/JPY cross to stage a recovery and move back above 1.4000 psychological mark. 

The pair initially dropped to 138.40 as risk-off sentiment was seen making an attempt to grip Asian equity markets. However, buoyant European equity markets dented the safe-haven appeal of the Japanese currency. 

Adding to this, better-than-expected UK jobs data provide additional boost to the British Pound and helped the GBP/JPY cross to rebound sharply from its near-term trading range support. 

Immediately after the release, the pair jumped to the vicinity of 141.00 mark before retracing back. The pair, however, has managed to hold 140.00 psychological mark and is currently trading around mid-140.00s.

Today's empty economic calendar is unlikely to provide any fresh impetus and the cross might continue to be driven by risk sentiment surrounding riskier assets - like equities.

Technical levels to watch

From current levels, 141.00 round figure mark remains immediate resistance to watch for, above which the cross seems to extend its recovery trend towards its next major resistance near 145.00 handle marking 50% Fibonacci retracement level of Brexit-led sharp slide. Intermediate resistance are pegged around recent swing high levels around 142.15-20 (July 14 high) and 143.20-25 (July 15 high).

On the flip side, 139.00 now seems to act as immediate support, which is followed by the trading range support near 138.30-25 area. A follow through selling pressure below 138.30-25 support opens rooms for an immediate slide to 137.30-137.00 support ahead of a major support near 136.30-25 region, representing 23.6% Fibonacci retracement level.