Central Banks vs. Cycles

The Central Banks have struck back, with BoJ's move to negative interest rates on Friday. I'm not convinced the dollar yen rally is sustainable. But with a net-line buy on the weekly chart, we have to respect the potential for more USDJPY advance. The next few sessions are important for the currency, as we'll see if this move was simply a one-and-done or a part of a larger trend.  More discussion inside!


click chart to enlarge


click chart to enlarge

I'll believe the dollar yen rally more if gold turns lower.

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Who’s On First?

After seeing a few too many tweets stating that the oil market is leading this highly-correlated dance, I investigated last night’s sharp reversal and found it was dollar yen, not crude oil that set the trend.


click chart to enlarge


click chart to enlarge

If world financial markets are depending on dollar yen now, we are in for some trouble, as the above long-term, as yet unconfirmed, head-and-shoulders formation on dollar yen shows.


click chart to enlarge


click chart to enlarge

Continue reading Who’s On First?