Fundamental overview:

USD/JPY is expected to consolidate with a bullish bias. USD/JPY is underpinned by the positive USD sentiment (ICE spot dollar index last 85.75 versus 85.39 early Wednesday) as U.S. Treasury yields inched higher (10-year at 2.219% versus 2.208% late Tuesday) after U.S. September CPI rose 0.1% in line with expectations, calming fears about the spread of deflation. USD/JPY is also supported by the demand from Japan importers, ultra-loose Bank of Japan's monetary policy and wider-than-expected Japan September trade deficit. But USD/JPY gains are tempered by Japan's export sales and selling of yen crosses amid increased risk aversion (VIX fear gauge rose 11.13% to 17.87, S&P 500 closed 0.73% lower at 1,927.11 overnight) amid reports of shootings in Canada's parliament building.

Technical comment:
Daily chart is mixed as MACD is bearish but stochastics is rising from the oversold zone.

Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 108.30 and the second target at 108.75. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 107.10. A break of this target would push the pair further downwards and one may expect the second target at 106.75. The pivot point is at 107.50.

Resistance levels:
108.30
108.75
109

Support levels:
107.10
106.75
106.35