GBP/USD building on to bullish momentum above 135.00 handle

The Japanese Yen remained weak across the board, with the GBP/JPY cross extending its recent recovery trend and surged past 135.00 handle to the highest level since August 1. 

Currently trading around 135.60-65 band, the cross touched 50-day SMA for the first time in post-Brexit regime and is fast approaching 136.00 round figure mark. Talks of further monetary easing by BoJ and disappointing Japanese industrial production data, released on Wednesday, has been the key factor driving the cross higher. Adding to this, recovery in the GBP/USD major provided an additional boost to the pair's recovery momentum. 

Going forward, a slew of US economic releases, including ADP report on private sector employment, would drive the safe-haven demand for the Japanese Yen and eventually provide fresh impetus to the GBP/JPY cross. 

From technical perspective, the cross is currently trading near a short-term ascending trend-channel resistance and a follow through buying interest would pave way for continuation of the near-term upward trajectory.

Technical levels to watch

The ascending trend-channel resistance is pegged near 135.75-80 region, above which a fresh leg of bullish momentum should boost the pair immediately towards monthly high resistance near 136.25 area. On the flip side, reversal from current resistance area, and a subsequent drop below 135.00 psychological mark support, could force the pair to break through session low support near 134.70 and head towards retesting support near 134.00 round figure mark.