GBP/JPY retakes 154.00 mark and beyond, over one-week high amid positive risk tone

• GBP/JPY gained traction for the second straight day and shot to over a one-week high on Monday.
• The risk-on impulse weighed on the safe-haven JPY and remained supportive of the strong move.
• Technical buying above the very important 200-day SMA provided an additional lift to the cross.

The GBP/JPY cross extended its strong intraday positive move and climbed further beyond the 154.00 round-figure mark, or over a one-week high during the mid-European session.

The cross built on last week's solid rebound from sub-151.00 levels, or the YTD low and gained strong follow-through traction for the second successive day on Monday. This also marked the fourth day of a positive move in the previous five and was sponsored by receding safe-haven demand, which tends to weigh on the Japanese yen.

Russia and Ukraine gave their most upbeat assessments over the weekend negotiations, which, in turn, boosted investors' confidence and dented demand for traditional safe-haven assets. Conversely, expectations for an additional rate hike by the Bank of England benefitted the British pound and acted as a tailwind for the GBP/JPY cross.

The optimism, however, remained capped amid a further escalation in the Russia-Ukraine conflict. In fact, Russia attacked a large Ukrainian base near the border with NATO member Poland on Sunday. Adding to this, a Kremlin spokesperson said on Monday that all the plans of Russia in Ukraine will be fulfilled in full and in the time frames outlined.

Nevertheless, the GBP/JPY cross rallied further beyond the very important 200-day SMA and seems poised to appreciate further. That said, traders might prefer to move on the sidelines ahead of the UK monthly jobs report on Tuesday and the BoE meeting on Thursday. This, in turn, warrants some caution before placing aggressive bullish bets.

Technical levels to watch