USD/JPY is under pressure. The pair recorded lower tops and lower bottoms since May 16 and broke below a rising trend line since May 12, which confirmed a negative outlook. The downward momentum is further reinforced by the declining 20-period and 50-period moving averages. The relative strength index is heading downward.
Therefore, as long as 113.20 holds on the upside, look for a further drop to 112.25 and even to 112.00 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 112.25. A break below this target will move the pair further downwards to 112.00. The pivot point stands at 113.20. 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 113.55 and the second one at 113.80.
Resistance levels: 113.55, 113.80, and 114.20
Support levels: 112.25, 112.00, and 111.55
The material has been provided by InstaForex Company - www.instaforex.com