• The USD/JPY pair sunk sharply towards lower levels on Tuesday, hitting as low as 101.20, after Japan's cabinet approved a package of spending in new fiscal measures.
   
• The government's package includes 7.5 trillion yen in spending by the national and local governments, and earmarks 6 trillion yen from the Fiscal Investment and Loan Program, which is not included in the government's general budget.
   
• Further upside is expected to be limited as the pair finds strong resistance at 102.52 which should limit upside and bring a decline towards lower levels.
   
• To the upside, the immediate resistance can be seen at 101.40, a break above this level would take the pair towards next resistance level at 101.73.
   
• To the downside immediate support can be seen at 101.06, a break below this level will open the door towards next level at 100.60.
  
  Resistance Levels
  
  R1: 101.40 (50% Retracement Level)
  
  R2: 101.73 (61.8% Retracement Level)
  
  R3: 102.52 (Aug 5th high)
  
  Support Levels
  
  S1: 101.06 (38.2% Retracement Level)
  
  S2: 100.60 (23.6% Retracement Level)
  
  S3:100.00 (Psychological levels)