GBP/JPY hits the brakes near 143.00, but bounce is limited

• Sterling struggling  to maintain bullish stance after recovering near ten-month bottom.
• UK data comes in better than expected, but still on the weak side.

The GBP/JPY is trading near 144.50 after recovering from a steep recent decline. The Sterling fell for eight straight trading days against the Yen recently, and the pair is trading into 10-month lows.

Market sentiment recovered yesterday after getting knocked down over the weekend as traders feared the possibility that Italy’s failed coalition government could see the country heading into fresh government elections in a proxy referendum vote on Eurozone membership for the country.

The GFK Consumer Confidence survey for May provided brief support for the Sterling after printing at a better-than-expected -7, a better improvement than  the expected -8 compared to the previous reading of -9.

Japan’s macro data for early Thursday was less uplifting, with Japan’s Industrial Production for the month of April coming in at just 0.3%, much less than the expected 1.2% and an even further contraction on the previous reading of 1.4%.

GBP/JPY levels to watch

As noted by FXStreet’s own Eren Sengezer, “the pair could encounter the first technical support at 143.20 (May 29 low) before extending its downside toward 142.70 (Sep. 11, 2017, low) and 141.20 (Sep. 5, 2017, low). On the other side, resistances align at 145 (psychological level), 146.15 (May 28 high) and 147.25 (May 24 high).”