On Wednesday, a decline of the USD/JPY was expected. The forecast was not precise, as instead of gradually declining the rate plummeted below the target and crashed patterns in a couple of hours after the daily publication was made.
On Thursday, the rate had found support in the 107.20 level and traded almost sideways.
Economic Calendar
On Thursday, at 12:30 GMT the weekly US Unemployment Claims are set to be released. They could create above average volatility.
On Friday, the US Producer Price Index and US Core Producer Price Index are set to be released. In the recent past they have not caused notable volatility.
Take a look at all of the historical reaction tables by clicking on the link below.
USD/JPY short-term daily review
On the one hand, it is likely that the exchange rate could continue to trade sideways in the 107.20/107.35 area within the following trading session.On the other hand, it is likely that bulls could prevail in the market in the short run. Meanwhile, it is unlikely that the rate could exceed the 107.45/107.58 area due to the resistance formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP.
Hourly Chart
On the daily candle chart, the rate has retreated to trade below the resistance of the 55-day simple moving average, which was located at 107.35. It has ended the squeeze in between without a sharp and initial break out.
Daily chart
On Thursday, on the Swiss Foreign Exchange 59% of open position volume was in short positions
On Wednesday morning, 60% of open position volume was short. Despite the sharp decline, traders have not taken profits.
Meanwhile, trader set up pending orders in the 100-pip range were bullish, as 63% of orders were to buy.
Previously, the orders were 53% to buy on Wednesday.