At mid-day on Tuesday, the USD/JPY pierced the last resistance levels before the 108.00 mark. The rate was expected to surge up to that level.
However, the rate is overbought, as indicated by the far below the rate left hourly simple moving averages.
Economic Calendar
Markit is going to publish the US Flash Manufacturing PMI survey results on Thursday, May 21, at 13:45 GMT. This is the only data release this week, which could impact the USD/JPY through the strength of the USD.
USD/JPY short-term daily review
As the rate passed the technical resistance of the weekly R1 simple pivot point at 107.71 on Tuesday, the pair had no resistance as high as the 108.00 level. At that level psychological resistance should be met.
However, the rate could trade sideways, as it had left far below it the hourly simple moving averages, which signals that it is overbought. In addition, the 107.80 level managed to cause a pause of the surge at mid-day GMT hours.
On the daily candle chart, the exchange rate has passed the resistance of the 55-day simple moving average, which kept the pair down since May 10.
In theory, next resistance on the daily candle chart for the pair is the 100 and 200-day SMAs near 108.30.
Daily chart
However, the rate could trade sideways, as it had left far below it the hourly simple moving averages, which signals that it is overbought. In addition, the 107.80 level managed to cause a pause of the surge at mid-day GMT hours.
Hourly Chart
On the daily candle chart, the exchange rate has passed the resistance of the 55-day simple moving average, which kept the pair down since May 10.
In theory, next resistance on the daily candle chart for the pair is the 100 and 200-day SMAs near 108.30.
Daily chart
Read More: Technical Analysis
Traders go short
Since the previous Wednesday, trader open position volume on the Swiss Foreign Exchange was 50% long.
Traders had been neutral for almost two weeks.
The situation changed on Tuesday, as the sentiment was 54% short.