Forex: GBP/JPY breaks and holds below 128

FXstreet.com (Barcelona) - GBPJPY keeps dragging lower on Yen strength and Pound weakness, last at 127.65, coupled with US bond demand following yesterday's Obama reelection, which is taking US bond yields to around 1-month lows 1.61% on hopes Bernanke will keep in charge of the FED and continuing with current monetary stimulus measures.

The cross finally broke to the downside last ascending trendline coming from Oct 124.75 lows, printing fresh 6-day lows yesterday at 127.40, and pull backing the broken trend line finding enough resistance below it making present session highs at 127.97. GBPJPY is down for the week by -0.97%, ahead of later's on BoE decision on interest rates at 12:00 GMT.

Immediate support to the downside for GBPJPY lies at yesterday's 6-day lows at 127.40, followed by Oct 30 lows at 127.00, and Oct 22 lows at 126.68. To the upside, nearest term resistance shows at recent session highs/Monday lows 127.97, followed by Oct 30 highs at 128.50, and starting price of current week/yesterday's highs at 128.83.