USD/JPY is expected to trade in a higher range as bias remains bullish. Overnight, US stocks declined, dragged by falling healthcare and biotech shares. The Dow Jones Industrial Average declined 0.3% to 17,168, the S&P 500 lost 0.6% to 2,018, and the Nasdaq Composite dropped 0.8% to 4,840. Nymex crude oil fell 2.4% to $45.20 per barrel and gold was down 0.9% at $1,167 per ounce. The benchmark 10-year Treasury yield dropped to 2.030% from 2.071% in the previous session. Meanwhile, the US dollar strengthened against most other major currencies, in particular, against commodity-based ones amid growing concerns about slowing global growth. USD/CAD surged 1.2% to 1.3137 as Canada's central bank held interest rates unchanged while lowering its forecasts on the country's economic growth for the next two years. The pair continues being supported by a rising trend line, while trading around the 20- and 50-period intraday moving averages (MA). Meanwhile, the intraday relative strength index (RSI) is mixed to bullish around the neutrality level at 50. The intraday outlook remains bullish and the pair is expected to proceed towards the first upside target at 120.55 (last seen on October 12).
Trading recommendations:
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 120.55 and the second target at 120.80. In the alternative scenario, short positions are recommended with the first target at 119.60 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 119.25. The pivot point is at 119.95.
Resistance levels:120.55 120.80 121.25
Support levels: 119.60 119.25 118.90
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