USD/JPY is expected to trade with a bullish bias US dollar indexes closed lower on Thursday pressured by shares in the semiconductor & semiconductor equipment, automobile & components and banks sectors. The DJIA fell 23 points to 17755, the S&P 500 slipped 0.94 point to 2089 and the Nasdaq composite lost 21 to 5074. The 10-year Treasury yield rose 0.080 percentage points to 2.174%. Nymex crude ended 0.3% up at $46.06, while gold was 2.4% down at $1,147.20/ounce. On the economic data front, US initial jobless claims changed a little reporting 260,000 last week from 259,000 the week before. The GDP rose by 1.5% after a 3.9% increase in the previous three months, mainly due to an inventory correction. Finally, pending home sales fell 2.3% in September following a $1.4% decrease in August. Economists had been expecting a 1% increase. USD/JPY remained in a trading range around 121.00 ahead of the BOJ's policy decision. The pair stays above its key support at 120.45 and is well supported by its 50-period intraday MA. And the intraday RSI is around 50 lacking downward momentum. Further upside is therefore expected with the next horizontal resistance and overlap set at 121.50. A breakout above this level would call for a further advance towards 121.90.

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 121.50 and the second target at 121.90. In the alternative scenario, short positions are recommended with the first target at 120.15 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 119.90. The pivot point is at 120.45.

Resistance levels:121.50 121.90 122.30

Support levels: 120.15 119.90 119.45