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Let's have a look at the BIG picture chart structure of Dollar vs. Yen, which argues for an approaching upmove in the USD (Yen weakness). Purely from an intermediate-term technical perspective, the pattern carved out by the USD/Yen since early 2007 into late 2009 has the right look of a completed downmove in the USD versus the Yen. In fact, twice during 2009, in January and again in November, the USD/Yen found key support and reversed from 87.14 and 84.82, respectively, which has left behind a potentially major double bottom. That said, to trigger initial confirmation of the establishment of a weekly double bottom, the USD/Yen must climb and sustain above 93.80. My near and medium-term work argue strongly that the Dollar is bottoming against the Yen – in other words, the Yen is about to begin a downside acceleration phase. If my work is accurate, then I want to be short the Yen against the Dollar – via the UltraShort Yen ProShares ETF (NYSE: YCS).
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
