Overview:

USD/JPY is expected to range-trade as markets await 19:00 GMT Federal Open Market Committee meeting minutes. USD/JPY is undermined by the weaker dollar sentiment (ICE spot dollar index last 80.00 versus 80.13 early Tuesday) on surprise plunge in the U.S. NAHB housing market index to 46 in February from 56 in January (versus forecast for no change at 56) and worse-than-expected drop in Empire State's business-conditions index to 4.48 in February from 12.51 in January (versus 8.0 forecast). USD/JPY is also weighed by the lower U.S. Treasury yields and Japan's export sales. But USD/JPY losses are tempered by the demand from Japan importers and Bank of Japan's announcement of extension by one year and doubling of the size of two programs offering cheap loans to commercial banks which raised expectations for more easing action by the BOJ later this year. Risk appetite is subdued as the U.S. stock indexes closed mixed overnight (S&P up 0.12%, DJIA off 0.15%), while VIX fear gauge rose 2.21% to 13.87.

Technical сomment:
Daily chart is positive-biased as MACD and stochastics are turning bullish.

Trading recommendation:

The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 101.75 in mind. A breach of this target will move the pair further downwards to 101.5. The pivot point stands at 102.45. In case the price moves in the opposite direction, bounces back from support level, and then moves above its pivot point, it is most favourably expected to move further to the upside. In that scenario, a long position is recommended with the first target at 102.75 and the second target at 103.05.

Resistance levels:
102.75
103.05
103.45

Support levels:
101.75
101.5
101.2