USD/JPY is still under pressure. Overnight the US stock indexes continued to move lower as oil prices resumed sell-off led to losses in energy shares. The Dow Jones Industrial Average edged down 0.1% to 17528, the S&P 500 fell 0.2% to 2056, while the Nasdaq Composite was down 0.2% to 5040. Nymex crude oil lost 3.4% landing at $36.81 a barrel.

Meanwhile, gold declined 0.7% to $1,068 an ounce, and the benchmark 10-year Treasury yield fell further to 2.227% from 2.241% in the previous session.

The U.S. dollar remained mixed against most major currencies. EUR/USD stayed broadly flat at 1.0965, while GBP/USD fell 0.4% to 1.4876 and USD/CAD was up 0.6% to 1.3904. The pair continues to stay on the downside while being capped by the 50-period (30-minute chart) moving average. The 20-period moving average has crossed below the 50-period one, and the intraday relative strength index stands below the neutrality level of 50. The intraday outlook remains bearish, and the pair is expected to return to the first downside target at 120.00 (the low of December 25). The second downside target is set at 119.80 (last seen on October 22). Only a break above the key resistance at 120.75 (a price base seen in December 22-23) would turn the intraday outlook bullish.

Trading recommendations:

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 120.00. A break of that target will move the pair further downwards to 119.75. The pivot point stands at 120.75. In case 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 121 and the second target at 121.30.

Resistance levels: 121.00, 121.30, 121.75

Support levels: 120.00, 119.75, 119.35