USD/JPY is expected to trade with bullish outlook above 112.20. Although the pair broke below the 20-period moving average, it is still trading above the rising 50-period moving average which plays a support role. The downside potential should be limited by the key support at 112.05.
Therefore, as long as 112.20 holds on the downside, look for a new rebound to 113.20 and even to 113.70 in extension.
Alternatively, if the price moves in the opposite direction as predicted, a short position is recommended below 112.20 with targets at 111.70 and 111.35.
Chart Explanation: The black line shows the pivot point. The current price above the pivot point indicates a bullish position while the price below the pivot point is a sign for a short position. The red lines show the support levels and the green line indicates the resistance level. These levels can be used to enter and exit trades.
Strategy : SELL, Stop Loss: 112.40, Take Profit: 111.70
Resistance levels: 113.20, 113.70, and 114.05
Support levels: 111.70,111.35, and 111.00
