USD/JPY is expected to trade in a higher range. It is underpinned by the reduced safe-haven appeal of the yen as global risk sentiment improves (VIX fear gauge eased 13.0% to 16.4; S&P 500 rose 1.53% to close at 2,063.15 overnight) after the European Central Bank announced a larger-than-expected bond-buying program aimed to revive the eurozone economy. USD/JPY is also supported by higher US Treasury yields (10-year at 1.885% versus 1.851% late Wednesday), the bullish dollar sentiment (ICE spot dollar index hit nine-year high 94.497 overnight, last at 94.21 versus 92.75 early Thursday) on divergent US monetary policy stance versus other major central banks, demand from Japan's importers as well as Bank of Japan's large-scale monetary easing policy. USD/JPY gains are also tempered by the Japan's export sales and positions adjustment ahead of the weekend.
The daily chart is mixed as the MACD is bearish, but stochastics is rising from oversold levels.
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. As long as the price holds above its pivot point, long positions are recommended with the first target at 124.35 and the second target at 124.60. In the alternative scenario, short positions are recommended with the first target at 123.35 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 123.10. The pivot point is at 123.60.
Resistance levels: 124.35 124.60 124.90
Support levels: 123.35 123.10 122.65
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