The passing of the resistance of the hourly simple moving averages and the weekly simple pivot point near the 104.20 level did not result in a surge. It occurred due to the resistance area of the 104.25/104.35 levels, which was spotted and marked on Tuesday.
In regards to the near term future, the rate should decline due to the resistance levels near the 104.20 mark and the newly marked resistance zone. However, since Monday, it appeared that the 104.00 round exchange rate level provided the pair with support.
Economic Calendar
The week is expected to be relatively calm for the USD/JPY pair regards to the economic calendar.
On Thursday, the US CPI data sets and the Unemployment Claims are set to be published at 13:30 GMT.
The week is set to end with the US Producers Price Index on Friday, at 13:30 GMT.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
USD/JPY short-term daily review
In regards to the near term future, the rate had even three scenarios.In the first case, the pair could trade sideways in the 104.00/104.20 range until a fundamental event causes a breaking of the resistance cluster of 104.20/104.30 or a drop below the 104.00 mark.
Secondly, the rate could pass the resistance of the 104.20/104.30 zone and surge to test the previous week's high levels at 104.60 and 104.75.
In the third scenario, the USD/JPY would pass the support of the 104.00 mark and aim at the support of the 103.80 level, which reversed the rate on December 4.
In general, it appears that round exchange rate levels are impacting the rate more than the technical indicators.
Hourly Chart
On the daily candle chart, one can observe that the rate faces the additional resistance of the 55-day simple moving average, which was located near the 104.80 level.
Daily chart
On Friday, on the Swiss Foreign Exchange 64% of volume was in long positions.
On Monday, the sentiment was 66% long, and on Tuesday it was 65% long.
Meanwhile, trader set up pending orders in the 100-pip range around the rate were 51% to buy the pair.