- SWFX market sentiment is 58% bearish (-1%)
- 51% of pending orders in the 100-pip range are to SELL
- No data will be affecting this exchange rate
Due to the resistance provided by the various simple moving averages of the hourly chart, the dominant ascending channel pattern's lower trend line was broken on Wednesday.
The US Federal Reserve announcement Interest Rates that came in line with expectation of <2.00% and the actual rate of <2.00% .
James McCann, senior global economist at Aberdeen Standard Investments says: The Fed "has already attracted the ire of the president for raising rates. This political interference is clearly unhelpful but may return as September approaches. I can't see Trump's tweets making [Fed Chairman Jerome] Powell change his course but it will be a test of his mettle to navigate the minefield of questions he'll inevitably get."
Only oil attracts attention
Wednesday's trading session has no relevant data releases scheduled, which might impact the USD/JPY currency pair.
However, volatility traders are set to join the Dukascopy release webinar at 14:20 GMT. The US Crude Oil Inventories are set to be published at 14:30 GMT. The data release has been giving almost 60 base points during each one of the weekly releases on Wednesdays during the past month.
USD/JPY fails to overcome 111.40
The USD/JPY exchange rate bounced off the psychological 111.00 mark mid-Tuesday and was heading towards the combined resistance of the 55-, 100– and 200-hour SMAs and the weekly PP at 111.40. This cluster provided an unbreakable resistance that stopped any attempts to accelerate from the senior channel.The positioning of technical indicators suggest that the rate is likely to test this area one more time today. The Greenback surpassing this level should not result in large gains, as moving averages on both the 1H and 4H time-frames have been successfully limiting the pair since mid-July.
The 100-period SMA and the monthly PP are located at 111.77. In terms of support, there is solid downside potential until the weekly S1 at 110.65.
Hourly Chart
Just like on the charts of the daily review of the hourly chart, the main attraction of the daily chart is the fact that the lower trend line of the massive long term ascending pattern was broken. The reasons for the breaking of the pattern most likely were the recent changes in the monetary policy of both the US and the Japanese central bankers.
It can be expected that by the end of July a new long term pattern will be clearly seen on the daily charts.
Daily chart
Traders of the Swiss Foreign Exchange continue to short the USD/JPY currency pair which is apparent by the 59% bearish positions. Meanwhile, trader set up pending trade orders are slightly shifted to the selling side. Namely, of the total set up orders are set to sell in 53% of all cases.
Saxo Bank traders are also shorting the USD/JPY, as 52% of set up orders at the brokerage are short. Meanwhile, OANDA traders are 55% long on the pair.
Take into account the fact that OANDA mostly serves large institutional clients that are setting up their positions more long term. From that it can be deducted that the markets for now are expecting the rate to decline in the short term, but in the larger term a surge is expected. Although, new fundamental information can change the situation quickly.
Spreads (avg, pip) / Trading volume / Volatility