Swiss Yen Weekly Candle Chart - 8th February 2009
A very similar chart to the euro yen currency pair, with last week’s candle providing us with little in the way of direction for our trading of the swiss yen pair this week, and in many ways has confused the picture still further. As you can see from the chart, since October of last year, the currency pair have been forming a downward wedge, which is basing the support in the $75.00 region. Last week’s up bar merely reinforced this picture, and it will be interesting to see whether prices breakout of this downward picture by breaking above the $85 region and above. My personal view is that it is very easy to simply be bearish on the pair, following the huge falls since the middle of 2008, and it is always a dangerous assumption simply to enter a trade following such a sustained fall and follow the trend as we have seen here. In all probability there will be a turn which may become a trend reversal, but in order to use this to our advantage we have to be patient, and wait for a clear signal to provide us with the direction that we need.
There is very little fundamental news out either in Japan or Europe this week, and hence I suggest you sit and watch, and look for other currency trading opportunities in other pairs ( of which there are plenty!).
The short term and medium term outlook is sideways, the long term is bullish.
