Overview:

USD/JPY is expected to trade in higher range.It is underpinned by the bullish dollar sentiment (ICE spot dollar index last 82.67 versus 82.56 early Tuesday) on a surprise rise in Conference Board U.S. consumer confidence index to 92.4 in August from a revised 90.3 in July (defying forecast for drop to 88.5), stronger-than-expected 22.6% on-month increase in U.S. July durable goods orders (versus forecast +7.5%), rise in Richmond Fed manufacturing index to 12 in August from 7 in July. USD/JPY is also supported by the demand from Japan importers and higher longer-dated U.S. Treasury yields (10-year at 2.398% versus 2.383% late Monday), reduced safe-haven appeal of yen amid positive global risk sentiment (VIX fear gauge eased 0.6% to 11.63; S&P 500 hit record high 2,005.04 before closing up 0.11% at 2,000.02 overnight). But USD/JPY gains are tempered by the Japan exporter sales.

Technical comment:
Daily chart is positive-biased as MACD is bullish, stochastics stays elevated at overbought zone, five and 15-day moving averages are advancing.

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 104.25 and the second target at 104.50. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 103.40. A break of this target would push the pair further downwards and one may expect the second target at 103. The pivot point is at 103.65.

Resistance levels:
104.25
104.50
104.80

Support levels:
103.40
103
102.70