- SWFX market sentiment is 65% bullish
- 65% of pending orders in the 100-pip range are set to BUY
- Pair remains just below 109.00 level
- US ADP Payrolls prior to FOMC
After Donald Trump did not announce anything unexpected during his address to the US Congress nothing has much changed on the USD/JPY currency pair's charts. Moreover, the pair has settled into a consolidation period prior to the Federal Reserve announcement scheduled for later in the day.
The US economy revealed weaker-than-anticipated expansion pace in Q4, as solid consumer spending resulted in an increase in imports. The Commerce Department stated that the US gross domestic product rose at a 2.6% yearly rate in the December quarter, compared with 3.2% in the Q3, being restrained by an expanding trade deficit and moderate inventory accumulation.
Meanwhile, durable goods orders rose 2.8% in December, with the US manufacturers benefiting from a solid global growth and a weaker currency, supporting the country's exports.
Payrolls and the Fed
Wednesday is set to be the top day for fundamental event traders of the US Dollar on all the financial instruments that involve the Buck.
First will be the ADP Non-Farm Employment Change at 13:15 GMT. The release will be covered on the bank's webinar platform live. Join by clicking on the notification on the JForex platform or find the webinars in the TV section.
However, later on in the day a more important event is set to take place. Namely the US FOMC Statement and the Federal Funds Rate are set to be published at 19:00 GMT. No large surprises are expected from the publication. However, prior to that the market might trade sideways.
USD/JPY remains below resistance
On Wednesday morning the USD/JPY currency exchange rate fluctuate at the levels of the previous trading sessions just below the 109.00 mark.However, there is one new development on the USD/JPY pair's charts. Namely, a short term channel up pattern has been marked.
Although, it is not expected that the channel will hold, as it is too narrow to represent the pair's movement to the upper trend line of the medium term pattern. Moreover, there is an upcoming fundamental event, which might break the channel.
In regards to the next 24 hours, watch whether the pair passes the support line of the mentioned junior pattern. If it gets passed, the pair should reach for the lower trend line of the most dominant pattern.
Hourly chart
By looking at the daily chart one can see that the situation remains the same. It can be seen that the next notable supporting trend line is located below the 108.00 mark.
In addition, in the near future the pair will be slowed down by the lower trend line of the already mentioned medium channel down pattern.
Meanwhile, last week we expected to see this week's calculated pivot points. In contradiction to what was expected, there are no notable support levels, which might slow down the fall of the US Dollar against the Yen.
Daily chart
SWFX traders are on the long side, as 66% of open positions were bullish during the morning hours. Meanwhile, 69% of pending orders are to buy the Greenback.
The market sentiment of OANDA traders remains bullish with 69% long positions (+2%). Meanwhile, Saxo Bank clients are likewise bullish, as 54% of open positions are long
Spreads (avg, pip) / Trading volume / Volatility