Sterling Bulls Flirting with 200.00 Mark Against Yen Before UK Data Release

The GBP/JPY cross is gaining positive momentum for the third consecutive day, with buyers attempting to push beyond the psychologically significant 200.00 mark during Asian trading hours Friday. Prices remain close to July 2024's peak levels as traders await the upcoming UK economic data dump for directional cues heading into the weekend.

I've been watching this pair closely, and the JPY's weakness stems from uncertainty around the Bank of Japan's rate cut timeline. The upbeat market sentiment isn't doing the yen any favors either, undermining its safe-haven appeal. Meanwhile, the pound benefits from reduced expectations for immediate BoE rate cuts and a softer dollar environment.

From a technical standpoint, the repeated failures to sustain momentum above 200.00 suggest caution is warranted. Smart money is waiting for a convincing break above the 200.35 YTD high before committing to further long positions. Daily oscillators remain in positive territory without hitting overbought conditions, suggesting room for potential gains toward 200.75, 201.00, and possibly 201.60 if momentum continues.

On the downside, support appears around 199.25, followed by the 199.00 mark. Any pullback to these levels might attract buyers, though a decisive break below the 198.40 horizontal support could trigger technical selling toward sub-198.00 levels, potentially extending to 197.35-197.30 before reaching 197.00.

The UK's monthly GDP release scheduled for Friday (06:00) will likely influence the pair's next move, with consensus expectations at 0% compared to the previous 0.4% reading.