On Friday, the USD/JPY currency pair was testing the support level formed by the 55-, 100- and 200-hour SMAs, as well the weekly PP at 109.45.
If the given support level holds, it is likely that the Us Dollar could consolidate against the Japanese Yen in the short run.
This week, there are no scheduled events left.
Next week, there are only three events that could affect the USD/JPY pair.
On Tuesday, December 31, the US CB Consumer Confidence will be published at 15:00 GMT.
On Friday, January 3, the ISM Manufacturing PMI survey results will be released at 15:00 GMT.
At the same day, the FOMC Meeting Minutes data will be published at 19:00 GMT.
Meanwhile, this week's scheduled event historical data tables have been published. Click on the link below to read the article.
Read More: 23.12-27.12 Event Historical Reactions
USD/JPY short-term daily review
Yesterday, the USD/JPY currency pair reached the upper boundary of the long-term descending channel at 109.65. During Friday morning, the pair reversed south.From a theoretical point of view, it is likely that the US Dollar could continue to depreciate against the Japanese Yen within the following trading session. In this case the pair could drop lower than the 109.35 level.
However, note that the exchange rate is pressured by the 55-, 100– and 200-hour SMAs, as well the weekly PP at 109.45. Thus, if the given support holds, the Greenback could consolidate against the Japanese Yen in the short run.
Hourly Chart
On the daily candle chart, the pair has been testing the resistance of the 50.00% Fibonacci retracement level at 109.60 since the middle of December.
Daily chart
Read More: Technical Analysis
Traders remain short
Since Monday, 73% of open USD/JPY position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, trader set up pending orders were strongly bearish. In the 100-pip range 88% of pending orders were to sell and 12% were to buy.