Overview:

USD/JPY is under pressure. It is supported by positive dollar sentiment(ICE spot dollar index last 81.19 versus 81.09 early Wednesday), higher U.S. Treasury yields amid expectations that the Federal Reserve will continue winding down its bond-buying program at the end of its two-day meeting on Jan. 29, and ultra-loose Bank of Japan's monetary policy. The BOJ on Wednesday unanimously maintained its policy of increasing the monetary base at an annual pace of Y60 trillion-Y70 trillion and demand from Japan importers. But USD/JPY upside is limited by Japan exporter sales. Daily chart is mixed as MACD is bearish, but stochastics is in bullish mode.

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. A short position is recommended with the first target at 103.5 in mind. A breach of this target will move the pair further downwards to 103.2. The pivot point stands at 104.5. In case the price moves in the opposite direction, bounces back from support, and moves above its pivot point, the price is most favourably expected to move further to the upside. In that scenario a long position is recommended with the first target at 104.75 and the second target at 104.9.

Resistance levels:
104.75
104.9
105.05

Support levels:
103.5
103.2
102.9