Since the second half of Monday's European trading hours, the USD/JPY has been testing the resistance of the 105.00 level and the 23.60% Fibonacci retracement level at 105.03.
At mid-day on Tuesday, the resistance of these levels was pierced, which signalled that the rate could reach for higher highs.
Economic Calendar
On Wednesday, the US ISM Non-Manufacturing PMI could cause a move from 6.1 to 16.0 pips.
Thursday will bring the usual weekly US Unemployment Claims at 13:30 GMT. The data has caused moves from 3.6 to 10.4 pips.
The week will end with the US monthly employment data sets at 13:30 GMT. Namely, the US Average Hourly Earnings, Unemployment Rate and Non-farm Employment Change will be published. The USD/JPY has moved 10.4 to 26.3 pips since September.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
USD/JPY short-term daily review
Since Tuesday evening, the USD/JPY currency pair has been testing the resistance level—the Fibo 23.60% at 105.03.It is likely that the exchange rate could gain support from the 55-hour moving average near 104.80 and trade upwards in the short term. Note that the rate would have to exceed the weekly R1 at 105.28.
In the meantime, if the given resistance holds, the currency pair could bounce off to the support provided by the 100-hour moving average and the weekly PP in the 104.42/104.53 range.
Hourly Chart
On the daily candle chart, the rate has broken the channel down pattern, which guided it since June. This signals an end of a half a year trend. In addition, the rate broke the resistance of the 100-day simple moving average at 104.40.
In regards to the near term future, note that the 100-day SMA was strengthening the support of the weekly simple pivot point at 104.42. In the meantime, the 200-day SMA was providing resistance at 105.60.
Daily chart
On Tuesday, on the Swiss Foreign Exchange 56% of open position volume was in short positions.
On Monday, 51% of volume was short.
Meanwhile, trader set up pending orders in the 100-pip range around the rate were 60% to sell.