Fundamental overview:
USD/JPY is expected to trade with a bullish bias. It is underpinned by the yen-funded carry trades amid the positive investor risk appetite (VIX fear gauge eased 2.54% to 16.11) as U.S. stocks rose Friday (S&P 500 closed up 0.71% at 1,964.58) amid fading concerns over slowing global growth after better-than-expected factory and GDP data out of China, and renewed expectations for central bank policy accommodation--tame U.S. CPI data suggests the Federal Reserve would be in no hurry to raise interest rates after the conclusion of its bond-buying program. USD/JPY also supported by demand from Japan importers; ultra-loose Bank of Japan's monetary policy. But USD/JPY gains are tempered by Japan's export sales and caution ahead of Fed's monetary decision Wednesday.
Technical comment:
Daily chart is positive-biased as stochastics is bullish, MACD staging bullish crossover against its exponential moving average, five-day moving average is above 15-day MA and is advancing.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 108.35 and the second target at 108.75. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 107.35. A break of this target would push the pair further downwards and one may expect the second target at 107.05. The pivot point is at 107.55.
Resistance levels:
108.35
108.75
109
Support levels:
107.35
107.05
106.75
The material has been provided by InstaForex Company - www.instaforex.com
