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Declan Fallon of Fallond Stock Picks Mar 26, 2008 Email this article to a Friend  Printer friendly page

The relationship between the Yen and the S&P and the relevance of the "Yen Carry trade" has been described expertly by the ETF expertFrom a technical perspective, spikes in the relationship between the Yen and S&P mark bullish reversals for the S&P. But the degree of the spike may indicate the strength of this bottom. The current spike is of comparable measure to spikes of late 1998 and 2001, but didn't reach the extremes of late 2002 and early 2003. If markets are in the early stages of a cyclical bear market within a secular bear market, then the possible outcome for the current bottom would favor the 2001 scenario over the 1998 one. If this was the case the next rally could take the market back to 1,450 (prior price congestion) before turning down towards the next support level at 1,150. This whole process could take 12-months to evolve.


But in the short and intermediate term (next 3 months), bulls should have control.

by Declan Fallon (Fallond Stock Picks)

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