For the second consecutive day, the GBP/JPY pair is showing gains. Mixed data from the UK failed to exert any noticeable pressure on the British pound.

On the other side of the pair, expectations that the Bank of Japan will continue its policy normalization and raise interest rates by the end of the year are preventing the Japanese yen from suffering deeper losses. However, domestic political uncertainty could make further monetary tightening by the Bank of Japan more difficult, ultimately limiting the intraday rise of the Asian currency.

Disagreements within the ruling Liberal Democratic Party (LDP) and its coalition partner Komeito have jeopardized Sanae Takaichi's ambitions to become the country's first female prime minister. At the same time, this has eased concerns about Japan's fiscal stability, keeping alive expectations for a possible rate hike by the Bank of Japan later this year.

From a fundamental standpoint, it would be prudent to wait for continued buying above the 203.00 round level before fully confirming the end of the correction and opening new long positions. Meanwhile, traders with a bearish bias may prefer to wait for a sustained move below 201.30 before entering new short positions.

From a technical perspective, oscillators on the daily chart remain positive, indicating that the path of least resistance for the pair is upward. Nonetheless, it is advisable to wait for a steady move above the 203.00 level before initiating new buy positions.

At the same time, for bears, it makes sense to wait for a decline below Tuesday's low near 201.30 before opening new short positions.