During Monday morning, the USD/JPY currency pair was trading near the resistance formed by the upper boundary of the long-term channel, as well the Fibo 50.00%.
If the given resistance holds, it is likely that the pair could go downwards.
This week, the pair could be impacted only by one data release. On Friday, the US Final GDP is set to be published at 13:30 GMT. However, since September 2018, the USD/JPY has moved only from 6.3 to 8.9 pips on the announcements.
Meanwhile, the week's scheduled event historical data tables have been published. Click on the link below to read the article.
Read More: 16.12-20.12 Event Historical Reactions
USD/JPY short-term daily review
At the end of last week, the USD/JPY currency pair reversed south from the upper boundary of the long-term descending channel. During Monday morning, the pair was trading at the 109.40 mark.From a theoretical perspective, it is likely that the US Dollar could maintain its depreciation against the Japanese Yen in the nearest future. In this case, it is unlikely that the pair could drop lower than the monthly PP at 109.03.
However, note that the exchange rate could gain support from the 55-hour SMA, currently located at 109.25 and re-test the upper channel line. If the given channel does not hold, the rate could target the weekly R1 at 109.91.
Hourly Chart
On the daily candle chart, the rate is testing the resistance of a 50.00% Fibonacci retracement level at 109.60. The same retracement level stopped a surge in late November.
Daily chart
Read More: Technical Analysis
Traders remain short
On Monday, 73% of open USD/JPY position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, trader set up pending orders were slightly bearish. In the 100-pip range 57% of pending orders were to sell and 43% were to buy.