USD/JPY is expected to trade with a bullish bias above 118.35. Overnight, the US stock indices closed lower after the US Federal Reserve left interest rates unchanged saying: "The committee is closely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation." The Dow Jones Industrial Average slid 1.4% to 15944, the S&P 500 lost 1.1% to 1882, while the Nasdaq Composite was down 2.2% to 4468.

Nymex crude oil gained another 2.7% to $32.30 a barrel, gold increased 0.5% to $1125 an ounce, while the benchmark 10-year Treasury yield edged up to 2.003% from 1.996% at the previous session.

Meanwhile, the U.S. dollar cannot benefit from the Fed's release, which did not cut uncertainty about another rate hike in March. EUR/USD rose 0.2% to 1.0891, AUD/USD gained 0.3% to 0.7025, and USD/CAD was down 0.2% to 1.4091. Meanwhile, GBP/USD fell 0.8% to 1.4229.

NZD/USD plunged 1.0% to 0.6430 as New Zealand's central bank maintained the official cash rate unchanged at 2.50% (as expected) saying: "Some further policy easing may be required over the coming year to ensure that future average inflation settles near the middle of the target range." The pair ran up to 119.07 before entering a consolidation zone. Currently it is trading above the key support level of 118.35. The 20-period (30-minute chart) moving average remains above the 50-period one, while the relative strength index is around the neutrality level of 50. As long as 118.15 holds as the key support, the intraday outlook stays bullish and the pair should challenge again the first upside target at 119.15.

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 119.15 and the second target at 119.50. In the alternative scenario, short positions are recommended with the first target at 118 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 117.60. The pivot point is at 118.35.

Resistance levels: 119.15, 119.50, 119.85

Support levels: 118, 117.60, 117.20