The decline of the USD/JPY on Monday reached the 107.25 level. However, by the middle of Tuesday's GMT trading hours, the rate had recovered and reached above 107.75.
At mid-day it was observed that the 107.75 provided resistance to the rate.
Economic Calendar
On Thursday, at 12:30 GMT the weekly US Unemployment Claims are set to be released. They could create above average volatility.
On Friday, the US Producer Price Index and US Core Producer Price Index are set to be released. In the recent past they have not caused notable volatility.
Take a look at all of the historical reaction tables by clicking on the link below.
USD/JPY short-term daily review
It is likely that some upside potential could continue to prevail in the market. Meanwhile, note that the exchange rate could face the resistance level formed by the monthly PP at 107.95.If the given resistance level holds, it is likely that a reversal south could occur. In this case it is likely that the rate could gain support from the 55-, 100– and 200-hour SMAs, as well the weekly PP in the 107.46/107.58 area.
Hourly Chart
On the daily candle chart, the rate trades between the resistance of the 100-day simple moving average at 107.70 and the support of the 55-day SMA at 107.40 level. It appears that the 100-day SMA stopped the surges that were attempted.
Daily chart
Read More: Technical Analysis
Short sentiment increases
On Tuesday, on the Swiss Foreign Exchange 61% of open position volume was in short positions
On Monday, 59% of open position volume was short.
Meanwhile, 56% of set up pending trade orders in a 100-pip range around the exchange rate were to sell.
Previously, the orders were neutral since Friday.