- The Swiss traders are 62% short
- Trader pending orders in the 100-pip range are set to buy 58% of all cases
- US data sets will impact USD/JPY on Wednesday
On Wednesday the USD/JPY was expected to surge above the 114.00 level. However, the currency exchange rate still faced the resistance of the 55-hour simple moving average, which fluctuating near 113.80.
Previously, the Institute for Supply Management released the US ISM Manufacturing PMI data that came out lower-than-expected of 59.8, compare to forecasted 60.1.
Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management says: "Export orders expanded, but four major industries are no longer contributing. Price pressure continues, but the index softened for the fourth straight month and dropped below 70 for the first time since December 2017. Demand remains robust, but employment resources and supply chains continue to struggle, but to a lesser degree. "
Busy week for US fundamentals
This week will be a busy one for macroeconomic data release traders. There will be notable data releases on Wednesday and Friday in the US that will impact the strength of the US Dollar and with it all of the currency pairs where it is involved.
On Wednesday, at 12:15 GMT the ADP Non-Farm Employment Change will be published. On the same day the ISM Non-Manufacturing PMI will be released at 14:00 GMT. Both data releases will be covered by Dukascopy Analytics on the bank's live webinar platform.
Meanwhile, all traders should note that on Friday at 12:30 GMT the US employment data sets like the Employment Change and Average Hourly Earnings will be published. By some financial media this event is seen as the most important of them all.
USD/JPY short term analysis
In regards to the near future, most likely, the US Dollar will continue surge upwards to the weekly R1 at the 114.13 level. The 100-hour SMA will support the rate during the trading session.On the other hand, the resistance of the 55-hour simple moving average might pass the 100-hour SMA support to push the currency exchange rate to go towards the weekly pivot point at the 113.28 level.
Hourly Chart
Each one of the large scale ascending patterns that was drawn in September was broken. Although, all of them were too narrow and expected to be broken.
Meanwhile, note that the recent surge has been guided by US Dollar gaining strength due to monetary policy and the recent updates in the US trader wars instead of technical levels.
Daily chart
Traders remain bearish, as 62% of trader open USD/JPY positions were short on Wednesday. Most likely the traders, who opened short positions were expecting a decline after the recent gains of the USD.
Meanwhile, trader set up orders, which could provide momentum to one or the other side, were set to buy in 57% of all cases.
The domination of buy orders was normal, as all of the short positions are followed by take profits and close orders that would buy the USD/JPY.