- The Swiss traders are 56% short
- Trader pending orders in the 100-pip range are 54% to buy
- Next notable data will be on Monday
On Friday, USD/JPY hat surged higher until it encountered resistance at 112.50. At that level the 55-hour simple moving average forced the currency pair lower.
This week the Bureau of Labor Statistics released US PPI data that came out in line with expectations of 0.2%.
"The Producer Price Index for final demand increased 0.2 percent in September, as prices for final demand services rose 0.3 percent, and the index for final demand goods decreased 0.1 percent. The final demand index advanced 2.6 percent for the 12 months ended in September." the U.S. Bureau of Labor Statistics announced on Wednesday.
No more data this week
This week's data releases have passed. There are no important macroeconomic data releases set to occur on Friday.
However, take note that already on Monday the data releases will resume. At 12:30 GMT the US Retail Sales and Core Retail Sales will be published.
The event will be covered by Dukascopy Analytics on the bank's webinar platform. The cover will begin at 12:20 GMT.
USD/JPY short term analysis
In regards to the near-term future, most likely, the US dollar will trade downside due to the resistance of the 55-hour SMA. It is expected that the rate will drop to the 111.40 level during the day.However, the US Dollar might trade sideways to stay at the 112.00 level due to a lack of fundamentals during the trading session.
Hourly Chart
On Thursday, on the daily chart it could be spotted that the USD/JPY had no support below it before the combination of the 55-day simple moving average and the lower trend line of the large scale ascending pattern at the 111.80 mark.
On Friday those levels were reached. However, the rate did not properly confirm the lower trend line of the ascending pattern. Due to that reason sideways trading or a decline are expected next week.
Daily chart
Since Monday, 69% of traders were shorting the USD/JPY. On Wednesday that changed, as by the middle of the day's trading 66% of traders were short.
By the middle of Thursday the trend had continued as 63% of traders were short, and on Friday already 56% were shorting the USD/JPY.
Meanwhile, trader set up orders were set to possibly push the rate even lower, as 54% of all orders were set to sell.
It can be assumed that some SWFX traders took profits from their shorting of the USD/JPY, as the rate began to trade sideways. Although, if the pair continues to decline, the traders will reopen their short positions.