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Dollar/Yen at 3 Month Highs!
By Mike Conlon | December 30, 2009
The US dollar/Japanese yen (USD/JPY) trade is at a 3-month high as high as 92.5 in today’s session. I’ve been on this trade since early December, when I mentioned in this article about the possible trend reversal that occurred and that the Japanese government was attempting (turns out successfully) to jawbone the yen lower. This also comes about on US dollar strength, which I’ve repeatedly mentioned over the past few trading sessions.
Also interesting to note is some weakness in the Canadian dollar, otherwise known as the Loonie (CAD). Its down across the board, most notably against the US dollar, -1.00%. This is due in part to oil price fluctuation as well as a pullback from the recent strength its been showing.
Because we are at year -end, I tend not to put as much emphasis on the price charts as volumes are lower so the normal patterns and strength and resistance levels that I usually rely on can be compromised. So while I do see some intriguing set-ups, I’m going to keep the rest of my trades very short-term until we start the New Year.
This will allow time for the heavy hitters to come back and decide where they want prices to be. Call it a New Year “reset”. Liquidity risk is sometimes a factor that most traders don’t consider. I tend to become more cautious as the end of the year approaches as I like to hold on to my profits, thank you very much!
So if you are trading now, look to be a bit more cautious going into year end.
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