As expected, the USD/JPY reached the 109.00 level. Moreover, the resistance levels at that price level were passed.
Although, the passing of 109.00 did not result in a surge up to the 109.39 level, as it was forecast on Tuesday.
The Institute for Supply Management (ISM) released the US ISM Non-Manufacturing PMI survey results, which came out better-than-expected of 54.7 compared with the forecast of 53.5.
Anthony Nieves, Chair of the ISM Non-Manufacturing Business Survey Committee commented: "According to the NMI, 13 non-manufacturing industries reported growth. The non-manufacturing sector had an uptick in growth after reflecting a pullback in September. The respondents continue to be concerned about tariffs, labor resources and the geopolitical climate."
Economic Calendar
Meanwhile, take into account that this week's reaction tables have been published. Take a look at the 04.11-08.11 Event Historical Reactions publication.
USD/JPY short-term daily review
Yesterday, the USD/JPY currency pair reached the psychological level at 109.20. During Wednesday morning, the pair was testing the weekly R1 at 109.04Given that the exchange rate is supported by the 55-, 100- and 200-hour moving averages, it is likely that some upside potential could prevail in the market. However, note that the rate would have to surpass the resistance level formed by the weekly R1 at 109.04.
If the given resistance level holds, it is likely that the currency pair could trade sideways around the 108.80 level in the short term. Also, it is unlikely that some downside potential could prevail in the market, and the pair could decline lower than the monthly PP at 107.94.
Hourly Chart
On the daily candle chart, the rate has passed the resistance of the 200-day simple moving average. The SMA on Wednesday began to provide technical support. Previously, the SMA kept the rate down throughout October.
Daily chart
On Wednesday, on the Swiss Foreign Exchange USD/JPY open position volume was almost neutral. 52% of open volume was short and 48% was long.
Meanwhile, trader set up orders were majorly bearish. Namely, in the 100-pip range 70% of pending orders were to sell and 30% were to buy.
The orders were 79% to sell on Tuesday.
In general, it could be observed that traders are expecting a reversal that would be followed by a decline.