USD/JPY is expected to trade with bearish bias as the key resistance at 114.15. The pair broke below its 20-period and 50-period moving averages, which play resistance roles. In addition, the 20-period moving average is turning down, and is about to cross below the 50-period one in sight. The relative strength index is heading downward. Even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.
Therefore, as long as 114.15 is resistance, look for a further downside to 113.30 and even to 112.75 in extension.
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 113.30. A break below this target will move the pair further downwards to 112.75. The pivot point stands at 114.15. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 114.60 and the second one at 115.00.
Resistance levels: 114.60, 115.00, and 115.45
Support levels: 113.30, 112.75, and 112.25
The material has been provided by InstaForex Company - www.instaforex.com