Last week the June 2012 yen futures opened at 1.22630 and closed the week at 1.24450. On April 2, the yen opened at 1.20570.
On the daily chart, we see technicals showing the move up building strength of trend with ADX now at 36.7. More importantly, we see the DI differential hitting zero on April 2; time to look for a possible entry. Since then +DI has been over –DI. We saw MACD was dropping divergence, but over the past few days we see MACD now adding divergence. And in Stochastics we saw a correction from overbought territory two weeks ago and now we see Stochastics going back into overbought territory.
Today’s price action shows the Yen now over 1.25000. You can see this move started mid-March as the Yen bounced off of 1.1900. The red and green lines on the chart does show Kamen technical trade signals. These are areas to really start focusing on the market and look for an entry. Also, watch for any news that could come out from Bank of Japan as they have intervened in the yen numerous times over the past year.
Proceed to Page 2 for the latest COT Data...
Looking at the weekly chart, you can see in the Legacy COT report that Commercials are dropping their net long positions and Large Spec are dropping their net short positions. The much more transparent COT Traders in Financial Futures report shows a clearer picture of how big money is posturing. Dealers (normally the sell side in an uptrend) are dropping net longs and Leveraged Funds are dropping net shorts. Currently we see Dealers net long 26,344, Asset Managers net long 55,971 contracts and Leveraged Funds are net short -49,688 contracts. Take a good look at the chart and see what happens to the yen when Dealers become net short. Neat isn’t it?
Have a prosperous trading week.
If you need help understanding how to understand how to use the NEW COT report to your benefit get instant access to my new e-book "What Lies Beneath ALL Trends". It is filled with eye opening information.Commercial Net Tracker instructions: This form tracks the Commitment of Traders (COT) data for the commodity futures market. This form "looks" at the most recent five weeks of COT data and provides visual indications of the data. A) If the current value is at a 12-month low, the cell will display a red/burgundy background. B) If the current value is at a 12-month high, the cell will display a green background. C) If the current value went from net negative to net positive, the cell will display a blue background (indicating a bullish condition). D) If the current value is both a 12-month high and also went from a net negative to a net positive, the background will be green. You should view the data with green backgrounds to determine if they also went from net negative to net positive.
Proceed to Page 3 for this week's detailed fundementals...
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