GBP/JPY seems vulnerable to break below 132.00 handle

Yen continues to surge, with the GBP/JPY cross erasing its tepid recovery gains to 132.83 and is now hovering near 4-week low level around 132.00 mark.

Weakness in global equity markets has been supportive for the safe-haven appeal of the Japanese currency. Meanwhile a broad based US Dollar sell-off is extending some support to the British Pound but has failed to halt its ongoing slide against the Japanese counterpart.

Earlier during the week, the cross rebounded to 134.00 handle but the recovery turned out to be short-lived and the pair touched a fresh 4-weekly low level at 132.00 round figure mark on Wednesday.

From technical perspective, the pair has been grinding lower within a short-term descending trend-channel and every recovery attempt is being sold into, clearly suggesting that the ongoing trend is likely to get extended in the near-term.

Technical levels to watch

On a sustained break below 132.00 immediate support, the pair seems to accelerate the slide immediately towards 131.00 round figure mark before dropping to retest 130.00 psychological mark support that coincides with the short-term descending trend-channel support.

Meanwhile on the upside, any recovery now seems to confront immediate resistance near 132.75-80 region, above which the momentum could get extended towards 133.90-134.00 strong resistance. Only a sustained strength back above 134.00 handle might negate the bearish bias and assist the pair to stage additional recovery in the near-term.