USD/JPY is expected to trade with a bullish bias. The pair recorded a succession of higher tops and higher bottoms since August 30, which confirms a bullish view. The rising 50-period moving average is playing a support role and maintains a positive bias. The relative strength index is still above its neutrality area at 50. A support base at 102.40 has formed and should limit the downside potential. As long as this key level is a support, look for a further rise to 103.65 and 103.95 in extension.
Trading Recommendation:
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. Therefore, long positions are recommended with the first target at 103.65 and the second one, at 103.95. In the alternative scenario, short positions are recommended with the first target at 102.10 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 100.50. The pivot point is at 102.40.
Resistance levels: 103.65, 103.95, 104.50
Support levels: 102.10, 101.65, 101.30
