GBP/JPY defends 144.00 handle for the time being

Having filled the weekly bearish gap, the GBP/JPY cross ran through some fresh offers near the 145.00 handle and has now dropped back to mid-144.00s.

The cross stalled last week's recovery move from monthly lows and came under some fresh selling pressure on Monday amid renewed jitters over the Brexit negotiations. 

The €100 billion divorce bill claimed by the EU officials and subsequent comments from the UK Brexit secretary Davis, threatening to walk away from the negotiations if the country faces such a massive bill, was seen weighing on the British Pound. 

   •  UK to start formal Brexit negotiations on 19 June - The Guardian

This coupled with the latest missile test by N. Korea further drove investors towards the Japanese Yen's perceived safe-haven appeal and collaborated to the pair's weekly bearish gap opening on Monday. 

Meanwhile, an offered tone surrounding the Japanese Yen and a slight improvement in investors' sentiment, as depicted by stability in equity markets, helped the cross to fill the bearish gap, albeit failed to lift it further beyond the key 145.00 psychological mark.

In absence of any major market moving economic releases, any fresh news/developments surrounding the impending Brexit negotiations would remain a key determinant of the pair's movement ahead of the UK PM Theresa May's interview later during the NY session.

Technical levels to watch

Bears would be eyeing for a break through the 144.00 immediate support, below which the cross is likely to accelerate the slide back towards 143.65-60 support area before eventually dropping below the 143.00 handle to test its next support near 142.60 region. On the flip side, sustained recovery move above the key 145.00 psychological mark might trigger a short-covering bounce towards 146.00 mark, with some intermediate resistance near 145.70 level.