YCS Ultrashort Yen Daily Chart Rising Wedge Overbot Negative Divergence

Here is a look at the yen. Keystone pointed out the inverted H&S on the dollar/yen all last year, so a weaker yen was on tap, however, the trade was not placed and instead the far smarter folks, such as Soros and Einhorn, made a killing taking advantage of the set-up. The BOJ is trying to inflate their way out of the two-decade recession by devaluing the yen. This is leading to all the currency war talk lately that is flaming more this morning with Russia making demands on the upcoming G20 meeting. A weaker yen (due to money printing just like the U.S.), results in a higher dollar/yen. The dollar/yen is reaching its target of 95-ish as well.

The YCS is an inverse ETF so as the yen weakens, YCS will move higher. Thus, the smart money like Soros and Einhorn entered the weaker yen trade in September-November, their technicians no doubt pointing out the positive divergence (green lines) indicating a potential bottom.  Soros cleaned up on the trade.  Look at the huge move higher as the wild Japan money-printing orgy continues in earnest. However, the red rising wedge, overbot conditions and negative divergence says time for a spank down. Moves like this have lots of momo so a sideways stutter step is in order but she should roll over now. In late January and over the last couple weeks is when the dumb money shows up. Joe Bagholder now receives the shares that Soros and Einhorn are distributing and over the next couple weeks will receive their head on a platter as they got into the trade too late. The BOJ is shuffling members so it makes sense that a rest occurs now, then the money printing program will accelerate in full force again in March-April. 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.