Today, the GBP/JPY pair is attracting aggressive intraday sellers following yesterday's rally and the rise during the Asian session to the 203.55 level. This comes amid the overall strengthening of the Japanese yen.

Weak U.K. employment data suggest that the Bank of England will likely continue cutting interest rates, as signs of economic slowdown increase the likelihood of further monetary easing.

Moreover, solid demand for the yen is putting downward pressure on the GBP/JPY pair, curbing its upward momentum. Recent remarks from Japan's Finance Minister, Katsunobu Kato, about possible sharp fluctuations in the foreign exchange market have heightened speculation that the authorities may be ready to intervene to prevent further yen weakness. Combined with renewed trade tensions between the U.S. and China, this reinforces the yen's role as a safe-haven currency and serves as a key factor weighing on the GBP/JPY cross.

However, a broad-based yen rally still seems unlikely, given concerns that domestic political difficulties could hinder the Bank of Japan's ability to raise interest rates further. Last week, the coalition between the Liberal Democratic Party (LDP) and Komeito unexpectedly collapsed, creating uncertainty about support for Prime Minister Sanae Takaichi in her bid to become Japan's first female premier and implement her priority policy reforms.

In addition, the prevailing risk-on sentiment in global markets may discourage traders from aggressively buying the yen, thereby limiting GBP/JPY's downside. Under such conditions, it makes sense to wait for signs of active selling below the key 202.00 level before opening new short positions.

From a technical perspective, oscillators on the daily chart remain positive, prices are holding above the 202.00 round level, and the pair is trading above the 9-day EMA, while the 9-day EMA lies above the 14-day EMA, confirming a positive outlook for the pair.