USD/JPY is expected to trade with bullish bias. Overnight, US stocks kept rising, lifted by energy and technology stocks. The Dow Jones Industrial Average gained another 0.5% to 17,918, the S&P 500 climbed 0.3% to 2,109, and the Nasdaq Composite was up 0.4% to 5,145. Nymex crude oil surged 3.8% to $47.90 a barrel, gold lost 1.4% to $1,117 an ounce, while the benchmark 10-year Treasury yield rose to 2.219% from 2.185% in the previous session. Meanwhile, the US dollar strengthened against most other major currencies. EUR/USD dropped 0.4% to 1.0966, USD/JPY rose 0.3% to 121.05, USD/CHF increased 0.4% to 0.9904. NZD/USD plunged 1.2% to 0.6660 overnight and fell further this morning as New Zealand's jobless rate edged up to 6.0% in Q3 from 5.9% in Q2. The pair remains on the upside and is currently trading around the rising 20-period intraday moving average (MA), which is above the 50-period one. Meanwhile, the intraday relative strength index (RSI) stays above the neutrality level at 50. The intraday outlook remains bullish and the first upside target is now set at 121.50 (high of October 30).
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. As long as the price holds above its pivot point, long positions are recommended with the first target at 121.50 and the second target at 121.80. In the alternative scenario, short positions are recommended with the first target at 120.55 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 120.20. The pivot point is at 120.90.
Resistance levels: 121.50 121.80 122.35
Support levels: 120.55 120.20 119.90
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