GBP/JPY bears remain in control, now eyeing 139.00 handle

The British Pound remained heavily offered across the board, dragging the GBP/JPY cross to fresh multi-week lows near 139.20-15 region. 

Spot build on Friday's weakness led by disastrous UK election result and came under intense selling pressure after the latest comments by the UK Brexit minister David Davis on the latest political scenario and Brexit issue. 

The selling pressure remained unabated following Moody's warning that inconclusive UK election outcome could be credit negative as it could further complicate, and probably delay the Brexit negotiations. 

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Meanwhile, a fresh wave of global risk-aversion trade, leading to a strong demand for traditional safe-haven assets, including the Japanese Yen, further collaborated to the pair's sharp slide to the lowest level since April 20.

Investors now look forward to this week's key event risks - BoJ and BoE monetary policy decisions, and important macroeconomic releases in order to determine the next leg of directional move for the cross.

   •  BoE, BoJ in focus this week - Rabobank

Technical levels to watch

Bears would be eyeing for a test of the 139.00 handle, below which the cross is likely to extend its downward trajectory towards 138.20-15 horizontal support with some intermediate support near 138.70 level.

On the upside, any recovery attempts might now confront immediate resistance near 139.50 region, which if cleared might trigger a short-covering bounce beyond the 140.00 psychological mark towards its next hurdle near 140.50-55 region.