GBP/JPY fails to respect Friday’s Doji formation as risk-tone sentiment gets heavy on virus 2.0 fears.
Expectations of UK PM Boris Johnson to offer autumn deadline to the EU gain dominance.
BOE is likely to announce an additional £150bn of stimulus on Thursday.
Japan’s Tertiary Industry Index, Brexit/virus updates will be the key to follow.

GBP/JPY bears the burden of the current risk-off mood while declining to 134.15, down 0.40% on a day, during Monday’s Asian session. Other than the increasing odds of the coronavirus (COVID-19) resurge, fears of another round of tough talks between the European Union (EU) and the UK PM Johnson also weigh on the pair. Additionally, odds that the BOE will unleash extra stimulus to combat the virus also spreads pessimism and drag the quote down under an ascending trend line from May 18.

The latest numbers from the US, Beijing and Tokyo have worrisome in that they suggest the risk of the COVID-19 return from which the market is yet to overcome. Also challenging the mood could be the comments from the World Health Organization’s Regional European Director Hans Kluge who urged the UK to not rush in easing lockdown restrictions.

Elsewhere, The Times came out with the news suggesting that the Bank of England (BOE) could add stimulus to its kitty. The new said, “the BOE is expected to unleash a further £150bn of stimulus in its latest attempt to cushion the economic damage from Covid-19 — as fresh evidence emerges of the rise in unemployment caused by the lockdown.”

On a different note, The Telegraph came out with the news suggesting that the UK PM Johnson could offer autumn deadline to the European leader for a deal. “The Prime Minister, his chief Brexit negotiator David Frost, and the Cabinet Office minister Michael Gove are due to hold "high-level talks" with Charles Michel, the President of the European Council, Ursula von der Leyen, the President of the European Commission, and David Sassoli, the President of the European Parliament,” said the news.

Amid these downbeat indicators, the market’s risk-tone remains heavy with the S&P 500 Futures and Japan’s NIKKEI flashing losses by the press time. Further, the US 10-year Treasury yields are also down over three basis points to 0.667% as we write.

Given the lack of major data on the cards, the GBP/JPY traders may keep eyes on the qualitative catalysts for immediate direction. Among them, Brexit might have a higher impact as being the major and an older issue looming over the UK policymakers.

Technical analysis

Considering the pair’s sustained trading below the short-term key support line, now resistance, coupled with the risk-off mood, sellers are likely to dominate for a while. In doing so, a 50-day SMA level of 133.60 seems to be the immediate support ahead of the early-May top near 133.15. On the upside, a clear break above 134.80 may aim for 00-day SMA near 135.60.

Additional important levels

Overview
Today last price	134.15
Today Daily Change	-0.52
Today Daily Change %	-0.39%
Today daily open	134.67

Trends
Daily SMA20	134.19
Daily SMA50	133.58
Daily SMA100	135.67
Daily SMA200	137.62

Levels
Previous Daily High	136.05
Previous Daily Low	133.8
Previous Weekly High	139.58
Previous Weekly Low	133.8
Previous Monthly High	135.08
Previous Monthly Low	129.32
Daily Fibonacci 38.2%	134.66
Daily Fibonacci 61.8%	135.19
Daily Pivot Point S1	133.63
Daily Pivot Point S2	132.59
Daily Pivot Point S3	131.38
Daily Pivot Point R1	135.88
Daily Pivot Point R2	137.09
Daily Pivot Point R3	138.13

GBP/JPY slips below monthly support line to probe 134.00, EU-UK Brexit talks eyed