The USD/JPY has been consolidating by trading sideways, as the pair found resistance at the 108.60 level.
The rate could resume its surge, as soon as the 55-hour simple moving average catches up with the rate.
Economic Calendar
On Wednesday, the US Consumer Price Index data could cause a minor move on USD assets at 13:30 GMT. The USD/JPY has moved from 4.7 to 21.5 pips on the announcement.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
USD/JPY short-term daily review
The USD/JPY started to consolidate after reaching above the 108.50 level. Namely, the rate began to trade sideways between 108.00 and 108.50.However, on Monday morning, the rate was making another attempt to surge. In the meantime, the resistance zone of 108.55/108.65 that caused the consolidation has been marked on the chart.
If the USD/JPY passes the resistance zone, the pair could reach first for the resistance of the 109.00 level and afterwards the weekly R1 simple pivot point at 109.23. On the other hand, in the case of the resistance holding, the pair could look for support in the 55-hour simple moving average, which was catching up with the rate.
Hourly Chart
On the daily candle chart, the rate has pierced the upper trend line of the channel up pattern, which captures the 2021 surge. Namely, the recent gains are larger and achieved faster than it was previously expected.
Moreover, the recent fundamental move broke the resistance of the 50.00% Fibonacci retracement level at 108.35.
Daily chart
On Monday, traders were 73% short on USD/JPY. The Swiss Foreign Exchange open positions have been mostly short for more than a week.
Meanwhile, trader set up pending orders in the 100-pip range around the rate were 56% to sell.