• USD/JPY inched higher on Monday as dollar strengthened across the board after New York Federal Reserve President William Dudley struck a hawkish tone on monetary policy, raising expectations that the U.S. central bank will continue tightening.
   
• Dudley said that halting the tightening cycle now would imperil the economy, adding that with unemployment at 4.3 percent and inflation at about 1.5 percent, "this is actually a pretty good place to be.
   
• No major economic data is scheduled for release this week to sway market direction as most investors were continuing to evaluate Fed policy.
   
• Further downside in this pair is expected to be limited as strong support at 110.40 is set to limit further decline and bring rebound back to higher levels in the short term.
   
• To the upside, the immediate resistance can be seen at 111.44, a break above this level would take the pair towards next resistance level at 111.71.
   
• To the downside, immediate support can be seen at 110.90, a break below this level will open the door towards next level at 110.40.
  
  Resistance Levels
  
  R1: 111.44 (38.2% Retracement Level)
  
  R2: 111.71 (June 2nd high)
  
  R3: 112.15 (23.6% Retracement Level)
  
  Support Levels
  
  S1: 110.90 (50% Retracement Level)
  
  S2: 110.40 (61.8% Retracement Level)
  
  S3:110.00 (Psychological levels)