FxWirePro: USD/JPY finds strong support at 108 levels, good to buy dips

• USD/JPY is extending recovery from Friday’s sell-off and is on track to regain 109 handle.
   
• Reports that PM Abe may put-off a sales tax hike diminished safe-haven bids for the yen amidst surging Japanese stocks.
   
• But Japan chief cabinet secretary Suga later dismissed media reports that PM Abe has decided to delay a sales tax hike scheduled for next year.
   
• He said that hike will go ahead unless there was a financial crisis on the scale of the Lehman Brothers collapse or a major natural disaster.
   
• The pair has given up some gains and trades around 108.75, we would recommend buying on dips.
   
• Techs support upside in the pair, major support lies at 108 (Psychological level and 10-DMA ), while major resistance is seen at 108.81 (21 day MA).
   
• Focus remains on Fed minutes, CPI and industrial production data due for release this week that will provide fresh direction on the major.
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Recommendation: Buy dips around 108.70/75, SL: 108.20, TP: 109/109.50