Eventually, the 108.80 mark did not hold, and the USD/JPY reached above the 109.00 exchange rate level. Moreover, the pair had begun to use the 108.80 level as a support.
In regards to the near term future, the rate could extend its gains, as soon as the 55-hour SMA catches up with it.
Economic Calendar
The week will end with the US Employment data set release on Friday 12:30 GMT.
USD/JPY short-term daily review
On Wednesday, the USD/JPY currency pair raised to the weekly R3 at 109.07. During today's morning, the pair was testing the given resistance level.
If the given resistance level holds, it is likely that some downside potential could prevail in the market. In this case the exchange rate could gain support from the monthly R1 and the 55-hour SMA in the 108.60 area.
If the given support holds, it is likely that the US Dollar could consolidate against the Japanese Yen in the short term. Otherwise, the rate could decline to the weekly R1 at 108.21.
On the daily candle chart, the pair has broken off the resistance of the 100 and 200-day simple moving averages at the 108.30 level.
Daily chart
If the given resistance level holds, it is likely that some downside potential could prevail in the market. In this case the exchange rate could gain support from the monthly R1 and the 55-hour SMA in the 108.60 area.
If the given support holds, it is likely that the US Dollar could consolidate against the Japanese Yen in the short term. Otherwise, the rate could decline to the weekly R1 at 108.21.
Hourly Chart
On the daily candle chart, the pair has broken off the resistance of the 100 and 200-day simple moving averages at the 108.30 level.
Daily chart
Read More: Technical Analysis
Short sentiment decline ends
Since Friday, short sentiment had declined from 64% short to 54% short on Wednesday.
On Thursday, traders were 56% short, as the decline of open short position volume proportion ended.