On Friday, the USD/JPY currency pair tried to decline below the 107.40 level.
During Monday morning, the pair broke the lower boundary of the short-term descending channel.
Economic CalendarThe week starts with the US Advance GDP release on Wednesday at 12:30 GMT. This is the first of three types of US quarterly GDPs. The Advance release reveals the first Gross Domestic Product numbers of a quarter. The following Preliminary and Final GDPs usually reveal slight adjustments. In general, the data will reveal the first impact of the coronavirus on the US economy.
Afterwards, at 18:00 GMT, the Federal Reserve is bound to make a rate statement, which is bound to react to the ongoing economic decline. Take into account that the Federal Reserve Rate announcement and FOMC Statement are set to be followed by a Press Conference at 18:30 GMT.
On Friday, the US ISM Manufacturing PMI is scheduled to be published at 14:00 GMT.
USD/JPY short-term daily review
On Friday, the USD/JPY currency pair declined to the 107.40. During today's morning, the pair broke to the lower boundary of the short-term descending channel.On the one hand, the exchange rate could continue to trade downwards in the short term. In this case the rate could face the support level formed by the weekly S2, the monthly PP and the Fibo 38.20% at 106.85.
On the other hand, the currency pair could reverse north from the psychological level at 107.00. However, it is unlikely that the pair could exceed 107.60 due to the resistance formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP.
Hourly Chart
On the daily candle chart, the rate faces the resistance of the daily simple moving averages. The SMAs were located from 108.29 to 108.80 levels.
Daily chart
Read More: Technical Analysis
Short sentiment declines
On Thursday, 59% of trader open position volume on the Swiss Foreign Exchange was in short positions.
On Friday, the sentiment declined to 56% short. A part of the bearish traders closed their short positions during the jump to the 108.00 mark.
On Monday, the sentiment remained to be 56% short.