Overview:
USD/JPY is expected to trade with a bullish bias. Spotlight on 1230 GMT U.S. April durable goods orders and 1400 GMT Conference Board U.S. May consumer confidence index. USD/JPY is underpinned by buying of yen crosses amid positive risk appetite (European stock markets closed higher Monday, with Stoxx Europe 600 up 0.5%, in thin trade due to a public holiday in the U.K. and the U.S.) on expectations of continued accommodative policies from the ECB and Federal Reserve, and continued impact from upbeat China May manufacturing PMI data. USD/JPY is also supported by the demand from Japan importers. But USD/JPY gains are tempered by the Japan exporter sales.
Technical Comment:
Daily chart is positive-biased as MACD and stochastics are bullish.
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 102.10 and the second target at 102.35. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 101.50. A breach of this target will push the pair further downwards and one may expect the second target at 101.20. The pivot point is at 101.70.
Resistance levels:
102.10
102.35
102.60
Support levels:
101.50
101.20
101
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