On Friday, the rate failed to recover, as the 55-hour SMA provided resistance and caused a decline below the 100-hour SMA.
On Monday morning, the decline continued, as the rate had reached the 105.45 level. In addition, the rate had no technical support as low as 105.34.
Economic Calendar
The week's notable events are set to start on Tuesday. At 12:30 GMT, the US Consumer Price Index could cause a noteworthy move. In September and August this event caused a slight increase of volatility. The rate has moved 6.0 to 11.8 pips on the event.
On Wednesday, the US Producers Price Index is scheduled to be published at 12:30 GMT. The last release occurred during a major increase of volatility. The USD/JPY has moved 4.7 to 14.8 pips during the last five announcements. However, the September move of 14.8 was an anomaly.
On Thursday, the weekly US Unemployment Claims will be out at 12:30 GMT. Since September, the publication caused moves of 4.2 to 14.8 pips.
On Friday, the US Retail Sales data is capable of causing slight increases of above normal volatility. However, in most cases the market barely reacts to this data. Namely, there are no sudden asset price and exchange rate adjustments.
The USD/JPY has moved from 6.1 to 13.6 pips on the release.
Click on the link below to find out more about the data releases.
USD/JPY short-term daily review
The rate was expected to reach the support of the monthly pivot point at 105.34. If this level fails to stop the decline, the weekly S1 at 105.26 level would provide additional support. In the case of both of them failing, the rate could reach for the 105.00 mark.On the other hand, if any of the pivot points stop the decline, the rate should trade sideways above them until the resistance of the hourly simple moving averages approach the pair.
Hourly Chart
On the daily candle chart, the rate is ignoring the 55-day simple moving average, which was broken last week. Previously, the SMA kept the rate down for three months.
Daily chart
Since Wednesday traders of the Swiss Foreign Exchange were short, as 64% of all open position volume was in short positions.
On Monday, traders added short positions, as 66% of volume was short. Namely, traders were profiting from the recent decline.
Meanwhile, trader set up pending orders in the 100-pip range were 70% to buy. Previously, the orders were 67% to sell.
It can be assumed that the sell orders were executed. In the meantime, the buy orders most likely are take profits and stop losses of the short positions.