Overview: 

USD/JPY is consolidating with bullish bias after hitting two-week high of 78.58 on Wednesday. USD/JPY is supported by positive USD sentiment after surprising rise in U.S. ISM non-manufacturing composite index to 55.1 in September from 53.7 in August (vs. forecast of drop to 53.1). Meanwhile, Automatic Data Processing reported more than expected 162,000 jobs were added in September (vs. +153,000 forecast). USD/JPY is also supported by buying of yen crosses amid improved risk sentiment (VIX fear gauge eased 1.78% to 15.43; S&P rose up 0.36% overnight) as upbeat U.S. data overshadowed signs of slowing growth in China and weak economic data from Europe; demand from Japan importers and investment trusts. But USD/JPY rises tempered by Japan exporter sales; caution ahead of today's ECB and BoE's interest rate decisions as well as tomorrow's U.S. non-farm payrolls data.

Preference: 
Long positions above 78.35 with targets at 78.85 and 79 in extension. 

Resistance Levels
78.81 (100-day moving average)
79 *** Intraday resistance
79.23-79.31 band (Sept. 19 high-200-day moving average)
79.66 (Aug. 20 reaction high).

Alternative scenario:
Below 78.35 look for further downside with 78.2 and 78 as targets.  

Support levels:
78.2 *** intraday support
77.97 (Tuesday's low)
77.79 (Monday's low)
77.43 (Friday's low).    

Comment:
USD/JPY daily chart positive-biased as MACD and stochastics in bullish mode; five-day moving average staging bullish crossover against 15-day MA. The RSI is bullish and calls for further advance.