USD/JPY long setup : FxWirePro | April 20, 2018

USD/JPY 0.21% extends gradual grind higher, break above 55-EMA at 107.37, bias higher.

Japan’s headline inflation slowed in March from the previous month, highlighting the central bank’s struggle to hit its 2 percent target.

Yen weakens across the board as markets now perceive the BoJ's 2% inflation target as incredibly lofty pushing farther anticipated monetary tightening.

On the other side, the greenback remains supported, rises tracking gains associated with the rise in US Treasury yields.

Technical indicators are biased higher. RSI is above 50 levels and +ve DMI dominance and bullish divergence which adds to upside bias.

Price action rages within daily Ichimoku cloud and only a break below will see drag lower.

On the upside we see next major resistance at 108.49 (38.2% Fib) ahead of 100-DMA at 109.05.

Support levels - 107.37 (55-EMA), 107.25 (5-DMA), 107 (23.6% Fib), 106.77 (20-DMA)

Resistance levels - 107.78 ( Apr 0.34% 13 high), 108, 108.49 (38.2% Fib), 109.05 (100-DMA)

Good to go long on dips around 107.45/55, SL: 107, TP: 107.75/ 108/ 108.45