However, at 14:30 GMT, the pair broke the resistance and started a surge.
Economic Calendar
On Wednesday, the rate is bound to move due to the release of the Federal Open Market Committee Meeting Minutes at 18:00 GMT.
On Thursday, the US quarterly Preliminary GDP data at 12:30 GMT is set to confirm or deny whether the United States have entered a recession. A recession is defined by two consecutive quarters of decline in the Gross Domestic Product.
Hourly Chart
If the pair continues to surge, resistance might be encountered in the 100-hour simple moving average and the 127.50 level. A move higher is highly likely going to reach for the 128.00 level and the resistance levels near 128.20.
In the case of a decline, the rate would once again look for support in the 126.37/126.50 zone. Further below, take into account the 126.00 and 126.50 levels and the weekly S2 simple pivot point at 125.44.
USD/JPY daily chart's review
On the daily candle chart, the pair has clearly broken the channel up pattern, which guided the rate's surge from the low level of March 30.On May 16, Dukascopy Analytics marked the April and May high level zone as resistance and late April and recent May low levels as support. Namely, resistance is located at 131.20/131.40 and support is at 126.90/127.55.
Most recently, the rate's support zone was being approached by the additional technical support of the 50-day simple moving average.
Daily chart
On Wednesday, on the Swiss Foreign Exchange, traders were 63% short as that amount of open position volume was in short positions.
Meanwhile, trader set up pending orders in the 100-pip range around the rate were 58% to sell the USD against the JPY.
On Tuesday, open positions were 64% short and pending orders were 60% to sell.