GBP/JPY soars to 136.00 on talks of fresh stimulus in Japan

The GBP/JPY cross maintained its strong bid tone and continues to build on to its Monday's strong recovery gains to currently trade around 136.00 mark. 

Japanese PMI Abe's confirmation of additional fiscal measure to stimulate economy and combat low inflation has weighed on the Japanese Yen since Monday. Moreover, easing political uncertainty in the UK is extending additional support for the recovery momentum around the GBP/JPY cross. 

On Monday, the British Pound got some respite after Conservative MP Andrea Leadsom quite the race to succeed Prime Minister David Cameron, leaving Home Secretary Theresa May as the only contender. 

The combination of news boosted the GBP/JPY cross, which has now staged a remarkable recovery of nearly 600-pips from early Monday low level around 130.00 neighborhood.

Technical levels to watch

From current levels, momentum above 136.00 handle is likely to get extended towards post-Brexit recovery high resistance near 138.80-139.00 region, with 137.00 and 138.00 round figure marks acting as intermediate support. On the flip side, sustained weakness back below 135.00-134.80 immediate support seems to drag the pair back towards 133.00 handle before the pair heads back towards the very important 130.00 psychological mark support.