Hey Forex / Market Watcher types: Why should not I be short-circuit the yen?
Then yen was riding the collapse of the carry trade for some time now. And for some reason, is seen as a currency "safe" in times like this. But if you look at the fundamentals, Japan is in big trouble. Therefore, this crazy rise in the yen is starting to look like the oil in the first half of 2008: a circle jerk speculative, without the fundamentals behind it. I wrong? It is too early to short term? What do you think?
Bad move. Japan has an exchange rate of 0.10%. If you short JPY against another currency, and that country / region falls your interest rate to stimulate its economy in a recession, JPY will rise. The same will happen if Japan increases its rate. The five main USD: 0.25% JPY EUR 0.10% CHF 2.00%: 0.50% GBP: 1.50% You definitely would be at risk with the rates of the cross. I would not be surprised if the United Kingdom to a rate cut. The Swiss franc is not good, even with a rate of 0.50%, because it moves like the euro and the European Union space for rate cuts. His only option to shorten the JPY against the USD. With the United States wants to improve employment and the housing market, I think the FOMC will leave rates at 0.25 U.S. for most or all of 2009, but you still have the hope that Japan would increase its interest rate. I am more knowledgeable about the stock market, but I have traded in the spot FX market before. If I were to change it now, I would short-circuit the pound against the dollar. UK is in recession and have more space cuts in interest rates. The U.S. and Japan do not.
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