The GBP/JPY pair is retreating from the psychological level of 190.00, or a two-week high reached earlier today. Following disappointing UK PMI data, selling pressure has intensified, pulling spot prices down to a new daily low around the 188.25 level.

The UK's weaker-than-expected PMI figures are weighing on the pound, while a moderate uptick in the US dollar adds further headwinds. Meanwhile, the Japanese yen is finding support from expectations of a Bank of Japan rate hike, which continues to strengthen the East Asian currency. Additionally, optimism surrounding a potential trade agreement between Japan and the US is helping to fuel the intraday decline in GBP/JPY.

Current expectations of rate cuts by the Bank of England are adding to the bearish outlook for the pound, suggesting further downside for GBP/JPY. However, improving US-China trade relations could help limit losses and offer some support to the pair.

From a technical perspective, the pair remains within a familiar range, suggesting ongoing consolidation. Daily chart oscillators remain in negative territory, and repeated failures to sustain gains above the 190.00 psychological level reinforce a bearish outlook.

A break below 188.00 would find initial support around the 187.50–187.45 zone. A decisive move below this region would confirm the bearish bias, making GBP/JPY vulnerable to further weakness toward the 187.00 level, followed by a test of 186.55. Continued downside pressure could ultimately drive the pair down to the key psychological level of 186.00, opening the door to deeper losses.

On the other hand, a move above 189.00 could spark another attempt to retest the 190.00 level, with intermediate resistance seen around the 189.45–189.50 level. A sustained break above the 190.00 threshold would shift sentiment more bullish, potentially triggering short-covering and lifting the pair toward the 50-day simple moving average (SMA) near the next psychological target of 191.00.

However, unless the Relative Strength Index (RSI) breaks decisively above the 50 mark, the pair may struggle to follow through on a bullish scenario.