Wednesday, December 18, 2013

USD/JPY Dollar/Yen Weekly and Today's Charts; 5-Year High; Banzai!

Banzai! The dollar/yen steadily gained steam as the day progressed. The dollar jumped after the Fed announcement and the BOJ continues to slap the yen, so a huge near 2-point jump occurs in the dollar/yen helping catapult U.S., and Japan, markets higher. The NIKK is up 1.5%. The dollar/yen hit 104.36 today and prints a new 5-year high. The weaker yen, however, should not last that much longer. The weekly chart shows the negative divergence now in place. Price may bounce along the rising red wedge during 2014. In 2011 and 2012, Keystone highlighted the bottom in the dollar/yen with the 3-year falling wedge, inverted H&S and C&H. The upside was never expected to be so dramatic and fast, however, and the big up move was a major cause in the higher U.S. stock market this year.

The expectation is that the yen will actually strengthen moving forward, so the dollar/yen is not expected to move substantially higher, and the negative divergence should take over and start to move it lower as the weeks play out. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

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