I have to confess that these days I have a yen to trade the yen. Central bankers of the world, whom I like to think of as the jockeys riding their respective currencies in the race to the bottom of the value barrel.
If that sounds negative, it was meant to be. Fiat money gives central bankers a license to print and they are exercising that privilege all over the world in a manner that is not going to end well. The US dollar is heading for a big time bruising somewhere down the road. But it will evidently have plenty of company.
However, the yen, thanks to the Bank of Japan’s implementation of Abenomics is determined that our Fed, nor any other central bank will not out print them. So the yen is probably going to become totally worthless before the US dollar. In the ugly contest currently going on in the currency world, the yen is the winner over the US dollar and just about any other currency on planet Earth. The yen is almost certain to tank before the dollar.
So I watch for opportunities to trade against the yen. Our current string of Wall Street selloffs is providing me opportunity after opportunity to get short the yen at attractive prices.
Currency traders are a strange lot. They run for cover of a safe haven currency whenever they sense a financial crisis is brewing. And we have financial crises brewing right and left these days.
What I find strange is that they consider the Japanese yen a safe haven currency. Once it was, but I have a hard time figuring out how it can be at this time. Of course I always try to remember a quote from one of my early mentors in trading, Alexander Elder, “the crowd may be stupid, but they are stronger that you are.”
So I continue to watch for opportunities to jump into a long position against the yen – usually using the USDJPY pair. But the markets are very volatile, so trading in these markets implies more risk than usual and a trigger finger ready to react quickly to changes in market momentum.
But I have an advantage over many other traders in hot and volatile markets; my RMI indicator. It provides three critical things needed to trade volatile markets:
1. It tells me where to place horizontal lines of future support and resistance.
2. The probable direction of the market in the near term
3. Sudden and significant changes in market momentum.
However, it is not for the lazy trader, as it does not pop up signals, you have to understand how it works and observe its action in real time trading situations. It takes a little effort, but is the best way to assess market oscillations I have every found in thirty years of futures, stocks and FOREX trading.
You can try the RMI for TradeStation free by clicking the link below:
And as a bonus, after you have been signed up as a RMI user for thirty days, I will send you a free copy of my eBook, See the Music of the Market.
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Author & Trader
Great system – couldn’t trade without it !!Frank YDavid, Panama
Thanks for the method !! Very solid, very logical entry and exit and genius SRV’s !!Denis DRussia
I trade the US Bond Markets exclusively – amazed at the accuracy of the SRV’s !!George SNew York, NY
….very impressed with the whole philosophy – both personal and trading, expressed in the book. I will read and revert !!Richard DUSA
“The SRV’s are amazingly accurate”.Tony Texas
the SRV’s are spot on !!Tom CUSA
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