USD/JPY is under pressure. The pair remains on the downside, capped by its negative 50-period moving average. The nearest key level at 113.25 plays a resistance role. In addition, the relative strength index is below its neutrality level at 50.
The US Labor Department reported 244,000 initial jobless claims for the week ended February 18 (vs. 240,000 expected, 238,000 a week earlier). The Chicago Federal National Activity Index dropped to -0.05 in January (vs. +0.00 expected) from +0.18 in December. Separately, the FHFA House Price Index improved 0.4% on month in December (vs. +0.5% expected, +0.7% in November).
Hence, as long as 113.25 holds on the upside, look for a return to 112.55 and 112.30 in extension.
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 112.55. A break below this target will move the pair further downwards to 112.30. The pivot point stands at 113.25. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 113.60 and the second one at 113.95.
Resistance levels: 113.60, 113.95, and 114.35
Support levels: 112.55, 112.30, and 112.00
The material has been provided by InstaForex Company - www.instaforex.com
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