USD/JPY is expected to trade with bullish bias. It is supported by a rising trend line. The US stocks moved little last Friday following Thursday's gains. The Dow Jones Industrial Average slipped 0.1%, to 16643, the S&P 500 added 0.1% to 1988, while the Nasdaq Composite rose 0.3% to 4828. Crude oil continued surging and added 6.2% to $45.22 a barrel, while gold futures rose nearly 1% to $1,133 an ounce. The 10-year Treasury yield climbed to 2.188% from 2.168% in the previous session. Meanwhile, the US dollar strengthened against the euro (EUR/USD declined to as low as 1.1154), as traders believed that the rate hike in September is still on the table considering Fed Vice Chairman Stanley Fischer's comments: "Given the apparent stability of inflation expectations, there is good reason to believe that inflation will move higher as the forces holding down inflation dissipate further." Regarding USD/JPY, the pair is rising since August 24. It has struck against the first upside target at 121.75, while the 20- and 50-period intraday moving averages (MAs) are well oriented. While a consolidation may develop, it should be limited considering the pair's upward momentum. Above 121.75, the second upside target is set at 122.35 (last seen on August 21). Only a break below the key support at 120.25 would turn the intraday outlook bearish and call for a further decline toward the first alternative downside target at 119.40 (last seen on August 26).

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 121.75 and the second target at 122.35. In the alternative scenario, short positions are recommended with the first target at 119.40 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 118.90. The pivot point is at 120.25.

Resistance levels: 121.75 122.35 122.80

Support levels: 119.40 118.90 118.45