USD/JPY is expected to trede with bullish bias. Overnight, US stock indexes closed broadly flat with the trading volume getting lighter ahead of the Thanksgiving holiday. The Dow Jones Industrial Average gained 1.2 points to 17,813, the S&P 500 slipped 0.2 point to 2,088, and the Nasdaq Composite was up 13.3 points (0.3%) at 5116. Nymex crude oil rose 0.4% to $43.04 a barrel, and gold declined 0.4% to $1,071 an ounce. Meanwhile, the benchmark 10-year Treasury yield fell to 2.232% from 2.243% in the previous session.

The US dollar was boosted by a series of economic data which upheld expectations for the Federal Reserve to raise interest rates in December. For example, new durable goods orders increased 3.0% in October (vs +1.7% expected; -0.8% in September), and initial jobless claims declined to 260,000 for the week ended November 21 from 272,000 a week before. The Wall Street Journal Dollar Index edged up 0.1% to 90.43. EUR/USD made a fresh 7-month low of 1.0565 before rebounding, and USD/CHF surged to as high as 1.0260. The pair has broken above a declining trend line and remains on the upside. It is currently trading around the 20-period intraday moving average (30-minute chart), which has crossed above the 50-period one. Meanwhile, the relative strength index is standing above the neutrality level at 50. As long as 122.40 holds as the key support, the pair could rise towards the first upside target at 122.80 (around yesterday's high) and the second one at 123.05.

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 122.80 and the second target at 123.05. In the alternative scenario, short positions are recommended with the first target at 122.20 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 122.00. The pivot point is at 122.40.

Resistance levels: 122.80 123.05 123.50

Support levels: 122.20 122 121.80