USD/JPY is expected to trade with a bearish outlook. The pair is trading below its 20-period and 50-period moving averages, which play resistance roles and maintain the downside bias. The relative strength index is below its neutrality level at 50.
The U.S. Commerce Department reported that GDP grew at a 3.1% annual rate on quarter in the second quarter, faster than +3.0% estimated previously.
Therefore, as long as 113.00 holds on the upside, look for a new test with targets at 112.20 and 112.00 in extension.
Alternatively, if the price moves in the opposite direction, a long position is recommended above 113 with a target at 113.25.
Chart Explanation: The black line shows the pivot point. The current price above the pivot point indicates a bullish position, while the price below the pivot point is a signal for a short position. The red lines show the support levels and the green line indicates the resistance level. These levels can be used to enter and exit trades.
Strategy: SELL, Stop Loss: 113.00, Take Profit: 112.20
Resistance levels: 113.25, 113.55 and 114.00 Support Levels: 112.20, 112.00, 111.50
The material has been provided by InstaForex Company – www.instaforex.com