USD/JPY is expected to trade with a bullish bias. It is underpinned by the reduced safe-haven appeal of the yen and yen-funded carry trades as global sentiment towards risk improved (VIX fear gauge eased 17.41% to 13.9, S&P 500 closed up 1.11% at 2,099.6 overnight) after Greece and its creditors had reached a conditional deal. The eurozone's leaders would give Greece up to EUR86 billion if the Greek Parliament passes pension overhauls and sales-tax increases by Wednesday. USD/JPY is also supported by higher US Treasury yields (10-year rose 3.1 bps to 2.446% Monday) and positive US dollar sentiment (ICE spot dollar index last 96.80 versus 96.01 early Monday) as reduced risk of "Grexit" opens a way for the Federal Reserve to begin raising the interest rates, demand from Japanese importers, and ultra-loose Bank of Japan's monetary policy. But USD/JPY gains are tempered by the Japan's exports.

Technical comment:

The daily chart is mixed as the MACD is bearish, but stochastics is rising from oversold levels.

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 123.45 and the second target at 123.70. In the alternative scenario, short positions are recommended with the first target at 122.60 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 122.20. The pivot point is at 121.90.

Resistance levels: 123.70 124 124.35

Support levels: 122.40 122 121.50