USD/JPY is expected to trade with bullish bias.The pair broke above the key resistance at 102.00 last Friday and kept pushing higher. Currently, the pair has located support above the 20-period (30-minute chart) moving average, which stands above the 50-period one. The intraday relative strength index is well directed above 50, lacking downward momentum. The U.S. Labor Department reported that nonfarm payrolls gained 255,000 in July (vs. +179,000 expected, upwardly revised +292,000 in June). The jobless rate remained unchanged at 4.9% (vs. 4.8% expected), and the average hourly earnings increased 0.3% on month and +2.6% on year.
U.S. government bond prices fell across the board with the benchmark 10-year U.S. Treasury yield shooting up to 1.583% from 1.503% Thursday. Gold dropped 1.9% to $1335 an ounce, the biggest fall in nearly three months, and silver plunged 3.1% to $19.66 an ounce, the largest loss in over four months.The intraday outlook is very bullish and the pair is expected to rise further toward 102.85 (a level of over-lapping support and resistance seen on July 29 -- August 2).
Trading Recommendation:
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. Therefore, long positions are recommended with the first target at 102.85 and the second one, at 103.90. In the alternative scenario, short positions are recommended with the first target at 100.95, 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 100.65. The pivot point is at 101.30.
Resistance levels: 102.85, 103.90, 104.60
Support levels: 100.95, 100.65, 100.00,
The material has been provided by InstaForex Company - www.instaforex.com