USD/JPY is expected to trade in a lower range as the key resistance is at 119.60. Overnight, US stock indices ended lower following a global stock-market sell-off. Earlier, China's markets were halted for the rest of the day after the 7% plunge triggered the circuit breaker. The Dow Jones Industrial Average lost another 1.6% to 17,148, the S&P 500 fell 1.5% to 2,012, while the Nasdaq Composite was down 2.1% to 4,903.

Nymex crude oil completed a volatile session with a loss of 0.8% to $36.76 a barrel, gold gained 1.3% to $1,074 an ounce, and the benchmark 10-year Treasury yield closed at 2.245%, down from 2.273% in the previous session.

While the Japanese yen strengthened across the broad (USD/JPY dropped 0.7% to 119.42), the US dollar stayed firm against most other major currencies, with EUR/USD dropping 0.3% to 1.0829, USD/CHF edging up 0.1% to 1.0016, USD/CAD rising 0.7% to 1.3951, AUD/USD plunging 1.2% to 0.7188 and NZD/USD losing 1.4% to 0.6749.The pair plunged to as low as 118.67 overnight before posting a rebound. Currently, it has peaked at levels below the key resistance at 119.60, and is trading below the 20-period (30-minute chart) moving average, which stands below the 50-period one. Meanwhile, the intraday relative strength index remains below the neutrality level of 50. As long as 119.70 holds as the key resistance, the pair should resume its downward path and return to the first downside target at 118.60.

Trading recommendations:

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 118.60. A break of that target will move the pair further downwards to 118. The pivot point stands at 119.95. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 120.20 and the second target at 120.75.

Resistance levels: 120.20, 120.75, 121

Support levels: 118.60, 118, 117.65