The USD/JPY surge reached the 106.55 level, which was tested two times before a retracement down began.
Namely, on Wednesday morning, the currency exchange rate had declined to 106.25 and had no support as low as 106.10.
Economic Calendar
On Wednesday, at 12:30 GMT traders should watch the release of the US Durable Goods Orders data. The event is capable of causing volatility increases above average level.
On Thursday, the US Preliminary GDP and the US Unemployment claims are set to be published. Due to these events usually not being released at the same time, the past reactions need to be combined. Namely, in the case of the same direction surprise the volatility pips need to be added one to another. On the other hand, different results shown by each data set could cancel one another out.
Click on the link below to find out more about the data releases.
USD/JPY short-term daily review
In the near term future, the rate was expected to decline to the support cluster near 106.10. At that level a monthly pivot point and the 55-hour SMA were located at. In the meantime, additional support was provided by the 100 and 200-hour SMAs at 106.00.In the case of these support levels holding, another surge would start and the rate could once again test the resistance of the 106.55 level.
Hourly Chart
On the daily candle chart, the resistance of the 55-day SMA has begun to strengthen the weekly R1 simple pivot point at 106.65.
Meanwhile, the 100-day SMA was providing resistance at 107.05.
Daily chart
Since Tuesday, traders of the Swiss Foreign Exchange were neutral, as 51% of all open position volume was short.
Meanwhile, trader set up pending orders in the 100-pip range were 51% to sell.
Previously, the orders were 56% to sell.