GBP/JPY attracted some dip-buying

The GBP/JPY cross reversed the post-BoE knee-jerk fall to the 151.25 area and refreshed session tops in the last hour. The uptick, however, lacked any strong follow-through, with bulls still struggling to find acceptance above the 152.00 mark. The cross witnessed some selling after the Bank of England announced its decision to leave monetary policy settings unchanged at the conclusion of the May meeting this Thursday. The decision was widely anticipated by the market, though the lack of clarity on future tapering plans exerted some downward pressure on the British pound.

Moreover, investors also preferred to wait on the sidelines amid the uncertainty over the outcome of the Scottish parliament election. Final opinion polls suggest a supermajority for pro-independence parties in Scotland, which might intensify pressure on the UK Prime Minister Boris Johnson to allow a second independence referendum. Hence, it will be prudent to wait for a sustained move beyond the recent swing highs, around the 152.40 region before traders start positioning for any further near-term appreciating move. Conversely, a convincing break below the 151.00 mark will mark a bearish breakdown through a one-and-half-week-old trading range.