The USD/JPY has plummeted below the 108.70 level. The fall of the US Dollar started on Monday and it was mostly fuelled by fundamentals.
Among them was the weakness caused by US trade tariffs, a trade dispute with the EU, Cuban retailers moving away from using the USD and lower than expected US ISM Manufacturing PMI survey results.
On Wednesday, there are two US events that the media will pay attention to. The ADP Non-farm Employment Change at 13:15 GMT and the US ISM Non-Manufacturing PMI at 15:00 GMT.
The ADP Employment Change has caused moves from 3.2 to 19.0 pips.
In the meantime, the ISM Non-Manufacturing PMI since June 2019 has caused moves from 8.0 to 56.6 pips.
On Friday, the US Employment data sets will be published at 13:30 GMT. The event consists of three numbers – Average Hourly Earnings, Non-farm Employment Change and Unemployment Rate. Since July, moves from 26.7 to 49.8 pips have been caused by the release.
Meanwhile, the week's scheduled event historical data tables have been published. Click on the link below to read the article.
USD/JPY short-term daily review
At the time of writing this article, the USD/JPY was continuing to decline and had no close by support levels, which could stop it.The most close by technical support level was a 38.20% Fibonacci retracement level at 108.44. The Fibo was strengthened by the monthly S1 pivot point at the 108.39 level.
In general, the rate was expected to end its decline near this level and consolidate by retracing upwards or fluctuating sideways.
However, the rate has closer support on the daily chart.
Hourly Chart
On the daily candle chart, one can see that from a technical viewpoint the decline was caused by the resistance of a 50.00% Fibonacci retracement level at 109.60.
In the meantime, on Tuesday the rate reached the lower trend line of a large scale channel up pattern near 108.60. The trend line should be watched for signals, whether the pair retraces back up or declines.
Daily chart
On Monday, 72% of open USD/JPY position volume on the Swiss Foreign Exchange was in short positions.
The sentiment decreased to 67% on Tuesday. It indicates that traders have been taking profits during the decline.
Meanwhile, trader set up pending orders were to buy. In the 100-pip range 92% of pending orders were to buy and 8% were to sell. Previously, 77% of orders were to sell.
In general, it can be observed that traders have profited from the fall of the USD/JPY. In regards to the future, SWFX traders have set up orders to buy. Namely, take profits from their short positions and open long positions.