FX.co ★ USD/JPY: Rebound

Overview:
USD/JPY is trading in lower range with rebound in sight. The rate is undermined by investor jitters on report Democratic and Republican leaders of the U.S. Senate expressed frustration over fiscal-cliff negotiations. USD/JPY is also weighed by Japan exporter sales; weaker USD sentiment after drop in Chicago Fed National Activity Index's three-month moving average to minus 0.56 in October from minus 0.36 in September, its lowest since November 2009; fall in Dallas Fed general business activity index to minus 2.8 in November from plus 1.8 in October. But risk sentiment soothed after euro-zone finance ministers and the IMF reported to have agreed Greek public debt should fall to 124 percent of GDP in 2020, bringing official creditors closer to a deal to release next tranche of aid to Greece. USD/JPY losses also tempered by demand from Japan importers; expectations that opposition Liberal Democratic Party will win mid-December elections and introduce aggressive monetary easing.
Data focus:
23:50 GMT Japan October corporate service price index,
13:30 GMT U.S. October durable goods orders, October Chicago Fed Midwest manufacturing index,
14:00 GMT U.S. September S&P / Case-Shiller home price index,
15:00 GMT U.S. September house price index, November Richmond Fed business activity survey,
15:00 GMT U.S. November consumer confidence index.
Preference:
Buy above 81.9 with targets 82.35 and 82.6.
Resistance Levels:
R1 - 82.35
R2 - 82.63 (Monday's high)
R3 - 82.84 (Thursday's seven-and-a-half month high)
Alternative scenario:
Sell below 81.9 .The downside breakout of 81.9 will open the way to 81.75 and 81.55.
Support Levels:
S1 - 81.92 (Monday's low)
S2 - 81.65 (Wednesday's low)
S3 - 81.13-81.08 (Nov. 20 low-Nov. 19 low)
Technical Comment:
The pair is rebounding on its support and is shaping a bullish flag. USD/JPY daily chart is mixed as MACD is bullish, 5- & 15-day moving averages are rising; but stochastics is bearish at overbought.