GBP/JPY remains depressed near multi-year lows, just above mid-128.00s

• Persistent fears of a no-deal Brexit continue to weigh on the British Pound.
• Trade concerns, slowing global growth benefits the JPY’s safe-haven status.
• Absent relevant Brexit headlines/macro data might help limit the downside.

The GBP/JPY cross continued with its struggle to register any meaningful recovery and remained well within the striking distance of over 2-1/2 year lows set earlier this week.
 
The cross failed to capitalize on the previous session's attempted bounce from the 128.00 neighborhood and edged lower through the mid-European session on Thursday. The GBP bulls held the defensive amid persistent uncertainty surrounding Britain's exit from the European Union by the new extended deadline on Oct. 31.

US-China trade tensions add to Brexit-led weakness

Adding to this, concerns over a full-blown US-China trade war and its impact on the global economic growth continued benefitting the Japanese Yen's safe-haven status and further collaborated to the pair's weaker tone for the second consecutive session - also marking its fifth day of a downtick in the previous six.
 
The negative factors, to a larger extent, were offset by improving global risk sentiment - as depicted by a positive mood around equity markets - which seemed to be the only factor helping limit deeper losses and warranting some caution before placing any aggressive bearish bets in absence of any Brexit-related headlines.
 
Hence, it will be prudent to wait for a sustained breakthrough the 128.00 handle before confirming a fresh near-term bearish break and positioning for the pair's next leg of a downfall towards testing its next major horizontal support near the 127.50 region.

Technical levels to watch