As expected, on Monday, the USD/JPY reached for the 110.00 level, which it almost reached. The pair shortly traded above the 109.95 level before starting a decline.
By the middle of Tuesday's London trading hours, the pair had dropped down to the 109.70 level. During the decline, the rate passed three hourly SMAs, the weekly PP and the lower trend line of a medium scale channel up pattern.
Namely, the rate ignored all technical levels, as it reacts to news.
Economic CalendarThis week, there is only one event that could influence the USD/JPY rate.
On Wednesday, the Federal Reserve will publish its FOMC Meeting Minutes at 19:00 GMT. The rate has moved from 6.2 to 15.3 pips at the time of the announcement.
Meanwhile, the week's data is available. Click on the link below to see the historical data tables with the reactions to the events.
Read More: 17.02.-21.02 Event Historical Reactions
USD/JPY short-term daily review
On Monday, the USD/JPY currency pair tried to surpass the 109.95. During today's morning, the pair broke the lower boundary of the medium-term ascending channel.Note that the exchange rate is pressured by the 55-, 100– and 200-hour moving averages, currently located circa 109.80. Thus, some downside potential could prevail in the market.
However, if the currency pair fails to surpass the 109.65 level, it is likely that the US Dollar could trade sideways against the Japanese Yen in the nearest future.
Hourly Chart
On the daily candle chart, the rate has left below it the daily simple moving averages. This factor indicates that the rate is overbought.
Daily chart
Read More: Technical Analysis
Traders short USD/JPY
Since Monday, 71% of open USD/JPY position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range 71% of pending orders were to sell and 29% were to buy.