Overview:
USD/JPY is expected to trade in a higher range. It is underpinned by positive U.S. dollar sentiment (ICE spot dollar index last 80.86 versus 80.58 early Friday) after Federal Reserve Chairman Bernanke gave an upbeat assessment of the U.S. economic growth in coming quarters and stressed that the Fed can manage the exit from its easy-money policies, further Fed's Plosser said the Fed may be "aggressive" about hiking interest rates, Fed's Lacker suggested that the Fed could raise its key policy rate as early as the end of this year. USD/JPY is also supported by higher U.S. Treasury yields, and expectations that the Bank of Japan will ease monetary policy further ahead of Japan's national sales tax hike which is due in April and demand from the Japanese importers and investment trusts. But USD/JPY gains are tempered by Japan's exports sales.
Technical сomment:
Daily chart is still negative-biased as MACD and stochastics is in bearish mode.
Trading recommendation:
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 far as the price is above its pivot point, a long position is recommended with the first target at 102.6 and the second target at 102.9. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 100.75. A breach of this target will push the pair further downwards and one may expect the second target at 100.4. The pivot point is at 101.4.
Resistance levels:
102.6
102.9
103.25
Support levels:
100.75
100.4
100.1
