This is a 20-year (monthly) chart of the US dollar against the Japanese yen. The dollar has declined in a primary down-trend since early 2008. Long-term support at 80 failed to halt the fall and the greenback is now ranging between ¥75 and ¥80.

The down-trend is in its fourth year and large bullish divergence on 63-day Twiggs Momentum warns of a reaction. Penetration of the declining trendline would strengthen the signal and breakout above 80 would confirm, offering a long-term target of 100.

By Colin Twiggs

http://www.incrediblecharts.com

Colin Twiggs is the leading commentator at Incredible Charts where he writes the Trading Diary , with more than 70,000 subscribers. His specialty is blending fundamental analysis of the economy with technical analysis of stocks, markets, commodities and currencies. Focusing on the role of the Fed and banking credit as primary drivers of the economic cycle, Colin successfully forecast the October 2007 bear market — eight months ahead of the sub-prime crisis.

These extracts from my trading diary are for educational purposes and should not be interpreted as investment or trading advice. Full terms and conditions can be found at Terms of Use .

© 2011 Copyright Colin Twiggs - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.