Overview:

USD/JPY is expected to trade with bearish bias. Liquidity is thin as financial markets in several countries in Asia and Europe were shut today for a holiday. USD/JPY is undermined by the negative dollar sentiment (ICE spot dollar index last 79.50 versus 79.81 early Wednesday) on much weaker-than-expected 0.1% annual rate expansion in U.S. 1Q GDP (versus +1.1% forecast), smaller-than-expected 0.3% rise in the U.S. 1Q employment cost index (versus forecast +0.5%). USD/JPY is also weighed by the lower U.S. Treasury yields and Japan's exports sales. But USD/JPY losses are tempered by the demand from Japan importers and yen-funded carry trades amid positive risk appetite (VIX fear gauge eased 2.19% to 13.41; S&P rose 0.3% overnight, while the Dow Jones Industrial Average posted record closing high of 16580.84) as stronger-than-expected rise in the U.S. Chicago PMI to 63.0 in April from 55.9 in March (versus 57.0 forecast) and ADP survey showing a bigger-than-expected 220,000 increase in U.S. private-sector jobs in April (versus +210,000 forecast) offset weak U.S. 1Q GDP data, while the Federal Reserve announced a further $10 billion reduction in its monthly bond purchases to $45 billion as expected and noted the recent pickup in economic growth which have slowed sharply during the severe winter.

Technical сomment:
Daily chart is negative-biased as MACD and stochastics turning bearish.

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 101.90 and the second target at 101.70. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 102.75. A breach of this target will push the pair further downwards and one may expect the second target at 102.90. The pivot point is at 102.65.

Resistance levels:
102.75
102.90
103.20

Support levels:
101.90
101.70
101.50