The USD/JPY pair is expected to trade with a bullish bias. The bias remains bullish.Overnight, the US stock indices closed higher with an end-of-session rally. Rising shares were noted in the health care equipment, software and pharmaceutical sectors. The Dow Jones Industrial Average rose 1.0% to 17888, the S&P 500 gained 1.1% to 2102, while the Nasdaq Composite was up by 0.9% to 5156. Nymex crude oil settled up 0.5% at $41.85 a barrel, gold was up another 0.5% to $1,069 an ounce, and the benchmark 10-year Treasury yield edged down to 2.155% from 2.220% at the previous session.

Meanwhile, the US dollar declined further as the November ISM Manufacturing Index came in at 48.6 (vs 50.5 expected, 50.1 in October). The Wall Street Journal Dollar Index dropped 0.5% to 90.45. EUR/USD rose 0.6% to 1.0631 and NZD/USD surged 1.4% to 0.6670.

The AUD/USD pair gained 1.3% to 0.7321 overnight, while this morning the Australian government reported that the country's 3Q GDP rose 2.5% year-on-year (vs rise of 2.4% expected) and 0.9% seasonally-adjusted on-quarter (0.8% gain expected). The pair underwent a choppy session yesterday and finally located at the key support of 122.75. It is currently trading above the 20-period intraday (30-minute chart) moving average, while the relative strength index is around the neutrality level of 50 lacking downward momentum. The intraday outlook remains bullish, and the first upside target is set at 123.20 (around yesterday's high) and the second one at 123.35 (around the high of November 30).

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 123.35 and the second target at 123.60. In the alternative scenario, short positions are recommended with the first target at 122.50 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 122.25. The pivot point is at 122.75.

Resistance levels: 123.35 123.60 124

Support levels: 122.50 122.25 122