The USD/JPY on Monday traded squeezed in between the 55-hour SMA as support at 111.67 and the 100-hour SMA with the weekly PP at 111.80.
In general, the rate could break out to both sides. Wait for the break out, which will reveal the short term direction of the currency exchange rate.
Census Bureau released the US Core Durable Goods Orders data that came out better-than-expected of 0.4% compared with forecast 0.2%.
The US Durable Goods Orders reached 2.7% in March. This is the strongest growth since July. According to analysts, the rise was driven by the growing demand for commercial aircraft. Economists are expecting that the US manufacturing, weakened by slower global economic growth and trade wars, will begin to recover in following months to support the economy.
Federal Open Markets Committee will impact USD/JPY
During this week there are various macroeconomic data releases that will impact currency exchange rates. Moreover, there will be a Federal Funds Rate announcement.On Tuesday, the Canadian GDP is expected to cause a significant impact on the CAD pairs at 12:30 GMT.
During Wednesday's trading session there will be two events to watch. First will be the ISM Manufacturing PMI, which will be covered this week for one reason. To once more show that this data release is not significant enough to be on economic calendars, as it causes no increases of volatility.
On the other hand, the opposite might be revealed during the analysis.
On the same day note that the most important event of the month will take place. At 18:00 GMT the US Federal Funds Rate and FOMC Statement will be published. The US Federal Reserve will reveal the future of the US Dollar.
On Thursday, the Bank of England announced their monetary policy data and information at 11:00 GMT. Moreover, the Governor of the bank will speak at 11:30 at a press conference.
On Friday, the US Employment data sets will be published at 12:30 GMT. This event is considered the second most important release for the USD. However, due to three data sets having individual impact on the USD the range of the volatility increase is wide during the data release.
Meanwhile, check out the previous data release covers and economic calendar analysis on the Dukascopy Webinars YouTube channel.
USD/JPY short-term daily review
On Friday, the USD/JPY currency pair traded sideways between the 111.60 and 111.80 levels.From a technical perspective, it is unlikely, that the pair could go upside, as it is pressured by the 55–, 100– and 200-hour SMAs located circa 111.80. Thus, it is expected, that the pair could target the psychological level at 111.40.
However, if the given resistance does not hold, it is likely, that the exchange rate could extend gains. A possible upside target is the psychological level at the 112.00 mark.
Hourly Chart
On the daily candle chart, the USD/JPY is being supported by the 200-day SMA at 111.47. In addition, the 55-day simple moving average was approaching the rate at 111.20 and was about to push the pair higher.Moreover, the rate is standing exactly on the lower trend line of a dominant large scale ascending channel pattern.
In general, the currency exchange rate is at long term crossroads. It will either drop through the support of the daily SMAs or be pushed up by them.
Daily chart
On the Swiss Foreign Exchange, 64% of the total open position volume was in short positions.
Meanwhile, trader set up pending orders were bearish, as 56% of pending commands in the 100-pip range were set to sell.