The sideways trading of the USD/JPY ended at midday on Wednesday. It ended with a crash down to the 108.50 level. Afterwards, the bearish pressure remained, as the rate resumed to decline a couple of hours later.
On Thursday the rate had found support in a previously broken trend line and pivot points near 107.85. The following surge had reached resistance levels near 108.25.
In general, the short term future scenarios were based on what will happen at 108.25.
US Bureau of Labor Statistics released the US ISM Non-Farm Employment Change data, which came out better-than-expected of 244K compared with the forecast of 162K.
According to the official release: "Notable job gains occurred in professional and business services, in health care, and in transportation and warehousing."
Minor US data
This week the data that will impact the USD/JPY will come from the US.
On Thursday, the US CPI and Core CPI data will be published at 12:30 GMT. The data release has caused moves from 11.5 to 17.5 pips since February.
On Friday, the US Producers Price Index will be released at 12:30 GMT. The event has caused moves from 3.9 to 31.9 pips. Although, note that the 31.9 pip move was actually caused by other announcements being made at the same time as the PPI was published.
For more information watch this week's Economic Calendar Analysis
USD/JPY short-term daily review
First of all, to properly see the large scale channel on the hourly chart zoom out and load the previous price information on the online chart.By doing that one can observe that the rate is surging after bouncing off the support of a previously broken resistance line. The surge has reached the resistance of the weekly PP at 108.22 and the 200-hour simple moving average at 108.28.
If the rate breaks these resistance levels, it could surge to the resistance of a 38.20% Fibonacci retracement level at 108.44.
On the other hand, the rate might bounce off the resistance levels and approach the support of the monthly and weekly pivot points located at 107.81 and 107.84.
Hourly Chart
On the daily candle chart, the pressure of the approaching resistance of the 55-day simple moving average at 109.10 was strengthening the decline.
Meanwhile, the SMA was expected to strengthen the technical resistance levels at 108.90 in the near future. As that occurs, it will be less likely that this level would get passed in a surge.
Daily chart
By the middle of Thursday's trading session, on the Swiss Foreign Exchange 74% of trader open USD/JPY position volume was in long positions.
During the last 24 hours these trader positions suffered losses.
Meanwhile, trader set up pending orders were neutral, as 48% of pending commands in the 100-pip range were set to buy and 52% were to sell.