USD/JPY is expected to trade with a bullish bias. The US indices rose on Wednesday led by shares in the Banks, Technology Hardware & Equipment, and Insurance sectors. On the economic data front, MBA mortgage applications fell 3.5% last week compared to an increase of 11.8% the week before. The Fed kept the target rate at 0.25% as the US Economy has been expanding at a moderate pace. The Dow Jones Industrial Average surged 198 points, or 1.1%, to 17780. The S&P 500 rose 1.2% and the Nasdaq Composite was 1.3% higher. Both yields on 10-year Treasury note and 2-year note rose after Fed's statement. Gold futures tumbled to a two-week low of $1152.10 a troy ounce after reaching a one-week high of $1176.10 a troy ounce, while the U.S. dollar reversed losses and posted a gain against common currencies. The pair is rebounding on its support base at 119.95 and remains on the upside. Both 20-period and 50-period intraday MAs are turning up, and the intraday RSI is above 50 and is well directed. Further upside is therefore expected with the next horizontal resistance and overlap set at 121.50 at first. A break above this level would call for further advance towards 121.75.

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 121.50 and the second target at 121.90. In the alternative scenario, short positions are recommended with the first target at 120 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 119.65. The pivot point is at 120.45.

Resistance levels:121.50 121.90 122.30

Support levels: 120 119.65 119.20