USD/JPY is expected to trade with a bullish bias above 109.60. The pair is consolidating and broke below its 20-period and 50-period moving averages. The relative strength index is around its neutrality level at 50 and lacks momentum. Nevertheless, 0.7545 is still playing a key support role, which should limit the downside potential. Even though a continuation of consolidation cannot be ruled out, its extent should be limited.

As long as 109.60 is not broken, look for a further upside toward 110.65 and even 111.00 in extension.

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 110.65 and the second one at 111.00. In the alternative scenario, short positions are recommended with the first target at 109.40 if the price moves below its pivot points. A break of this target may push the pair further downwards, and one may expect the second target at 108.95. The pivot point is at 109.60.

Resistance levels: 110.65, 111.00, and 111.50

Support levels: 109.40, 108.95, and 108.50