On Monday, the USD/JPY currency exchange rate experienced a sharp move upwards, which was caused by the announcement of another, more effective coronavirus vaccine. However, afterwards the rate retraced back down to the 104.50 level.
Moreover, by the middle of Tuesday's GMT trading hours, the rate had reached a new low level, as the 104.25 mark was providing support.
Economic Calendar
Notable data releases start on Tuesday. At 13:30 GMT, expect the US Retail Sales data sets to slightly increase USD volatility.
On Thursday, expect the usual US Unemployment Claims at 13:30 GMT.
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 rate has no technical support that could stop it from plummeting. The most close by technical support level was the weekly S1 simple pivot point at 103.39.In theory, the USD/JPY should continue to decline, as it has no technical support. However, a decline could be stopped by the psychological support of the round exchange rate levels. For example, the 104.00 and 103.50 level could stop a decline.
In the meantime, note that the hourly simple moving averages were left above the 104.50 level. It indicates that the rate could consolidate by trading sideways or retracing slightly back up before starting a decline.
Hourly Chart
On the daily candle chart, the rate has returned to the support of the previously broken lower trend line of a descending triangle pattern. Due to the fact that this trend line was previously broken, it is unlikely that it could cause an end of the USD/JPY decline.
Daily chart
On Tuesday, on the Swiss Foreign Exchange 50% of volume was in short positions and 50% was in long positions. The sentiment had become balanced.
On Tuesday, trader set up pending orders in the 100-pip range around the rate were 80% to buy the pair.
The orders were 58% to buy on Monday.