Overview:

USD/JPY is expected to consolidate with bearish bias after hitting seven-week low 101.77 this morning.It is undermined by the flows to haven yen and unwinding of JPY-funded carry trades amid elevated risk aversion (VIX fear gauge spiked 31.74% to 18.14, S&P tumbled 2.09% Friday) on fears over emerging markets, Chinese economic slowdown and further Fed tapering of its stimulus efforts. USD/JPY is also weighed by the lower U.S. Treasury yields and Japan exporter sales. But USD/JPY losses are tempered by demand from the Japan importers and ultra-loose Bank of Japan's monetary policy.

Technical сomment:
Daily chart is negative-biased as MACD and stochastics are bearish, five and 15-day moving averages are declining.

Trading recommendation:

The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. A short position is recommended with the first target at 102.25 in mind. A breach of this target will move the pair further downwards to 101.9. The pivot point stands at 103.05. In case the price moves in the opposite direction, bounces back from support, and moves above its pivot point, the price is most favourably expected to move further to the upside. In that scenario a long position is recommended with the first target at 103.55 and the second target at 103.8.

Resistance levels:
103.55
103.8
104.1

Support levels:
102.25
101.9
101.75