On Tuesday morning, the rate was testing the resistance of pivot points and the 55-hour simple moving average at 105.85.
Economic Calendar
On Thursday, at 12:30 GMT the US Preliminary GDP is scheduled to be published. The event has caused moves on USD/JPY charts from 2.8 to 19.4 pips since February.
USD/JPY short-term daily review
Yesterday, the USD/JPY currency pair tried to surpass the resistance formed by the 55-, 100– and 200-hour SMAs in the 106.00/106.24 range. During Tuesday morning, the pair was trading at the 105.75 level.Given that the exchange rate is still pressured by the given moving averages, it is likely that some downside potential could prevail in the market in the short term. Note that the nearest support level is the weekly S1 at the 104.91 mark.
However, if the given moving averages do not hold, it is expected, that the US Dollar could try to appreciate against the Japanese Yen. But it is unlikely, that the rate could exceed the monthly S2 at 106.54.
Hourly Chart
On the daily candle chart, the recent drop pierced the lower trend line of the dominant descending channel pattern.
Moreover, the rate had traded below the historical low level of 104.64.
Daily chart
Read More: Technical Analysis
Traders remain long
On Tuesday, 69% of USD/JPY open position volume on the Swiss Foreign Exchange was in long positions.
Meanwhile, trader set up orders were bearish. Namely, in the 100-pip range 55% of pending orders were set to sell and 45% were to buy.