FxWirePro: USD/JPY bounces off lows with 'Morning Star' formation, eyes 100-DMA at 111.28, stay long

• USD/JPY is trading a narrow range on the day, intraday bias bullish.
   
• The safe-haven yen under pressure amid improved risk sentiment as N.Korea tensions fade.
   
• On the other side, USD remains bid on rising rate hike expectations this year on the back of strong retail sales data and Fed's Dudley's optimism.
   
• Data released on Tuesday showed U.S. retail sales grew by 0.6% m/m in July. Furthermore, June's data was also revised up to 0.3% from -0.2%. 
   
• Data suggested increased consumer spending, which would eventually translate into higher inflation. 
   
• Focus now on the FOMC minutes which could shed further light on the inflation debate.
   
• Technically, the pair has bounced off with a 'Morning Star' formation. Momentum studies bullish.
   
• Immediate resistance lies at 111.28 (100-DMA), breach above eyes 200-DMA at 112.40.

Support levels - 110.58 (20-DMA), 110.23 (May 18 low), 109.86 (5-DMA)

Resistance levels - 110.93 (38.2% Fib of 114.49 to 108.72 fall), 111.28 (100-DMA), 112.40 (200-DMA)

TIME  TREND INDEX  OB/OS INDEX    

1H          Neutral                Neutral       
4H          Bullish                 Overbought       
1D          Neutral                Neutral        
1W         Neutral                Neutral      

Recommendation: Good to go long on dips around 110.50/60, SL: 109.85, TP: 111/ 111.30/ 111.80

FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 120.464 (Bullish), while Hourly JPY Spot Index was at -72.4758 (Neutral) at 0340 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex. 

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