USD/JPY is expected to trade with a bullish outlook. The pair is trading below its declining 20-period and 50-period moving averages, which play resistance roles and maintain the upside bias. The relative strength index is mixed with a bearish bias. The upward potential is likely to be limited by the resistance at 111.40.
Therefore, as long as this key level is not surpassed, look for a further decline to 110.80 and even to 110.50 in extension.
Alternatively, if the price moves in the opposite direction, a long position is recommended above 111.40 with a target at 111.70.
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 signal 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: 111.40, Take Profit: 111.95
Resistance levels: 110.80, 110.0, and 109.45 Support Levels: 111.70, 111.95, 112.35
