Fundamental outlook:
USD/JPY is expected to consolidate after hitting a six-day low of 119.07 on Tuesday. It is undermined by the weaker dollar sentiment (ICE spot dollar index last 98.78 versus 99.50 early Tuesday) after weaker-than-expected 0.9% on-month increase in the US March retail sales (versus forecast +1.1%) and a surprising drop in the US NFIB index of small business optimism to 95.2 in March from 98.0 in February (versus forecast 98.1). USD/JPY is also weighed by the lower US Treasury yields (10-year at 1.898% versus 1.939% late Monday) and Japan exporter sales. But USD sentiment is soothed by the stronger-than-expected 0.3% on-month increase in US February business inventories (versus forecast +0.2%). USD/JPY downside is also limited by the demand from Japan importers and ultra-loose Bank of Japan's monetary policy, buying of the yen crosses amid an improved risk appetite (VIX fear gauge eased 1.94% to 13.67; S&P 500 closed up 0.16% at 2,095.84 overnight) as oil prices rallied (Nymex crude settled up $1.38 at $53.29/bbl Tuesday).

Technical comment:
The daily chart is tilting negative as stochastics is in bearish mode, the MACD is turning bearish.

Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below the pivot point. Short positions are recommended with the first target at 119.20. A break of that target will move the pair further downwards to 118.90. The pivot point stands at 119.75. 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 120.05 and the second target at 120.40.

Resistance levels:
120.05
120.40
120.80
Support levels:
119.20
118.90
118.65