FINANCIAL ICEBERG
Always consider hidden risks
​
 TECHNICALS
SP500 and the Yen: A Warning Sign?
April 7 2016  ​( From TradingView, CNN, Blommberg  )
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​​The Situation
​
​In these greedy times (interesting to note​​ the Fear and Greed Index 
​from CNN Money is coming from Extreme Fear in mid-February 2016
​to the Extreme Greed Level now at 77). It is interesting to look the 
​behavior of ​the ​YEN (first chart below - top panel - candles) ​in ​relation to 
​the Mighty SP500 ​(first chart below -bottom panel -bar chart).

Following the YEN can gives us a clue about the next trend in the 
​Mighty SP500...​​​​​ Interesting to note that in both cases (Yen and 
​SP500), both highs made almost a few weeks apart (May 20 2105 for 
​the ​SP500 Index at 2134 and June 5 2015 for the Yen at 125.85.

But few of us realize that the Yen broke a Monthly Uptrend Channel 
​that started back in October 2012. All that when the BOJ (Bank of 
​Japan) announced their new negative rates policy on January 29 2016. ​
​(See first chart below - Downtrend Channel)​

​​The Mighty SP500 broke already its Monthly Uptrend Channel​​, ​earlier than the Yen but in a Major Divergence lately as Yen broke down and SP500 Index near the resistance trendline of a channel. (See first chart below)​

But the most interesting technical factor is that ​the Yen broke on April 6 2016 below the previous breakout zone (October 31 2014) (See Second Chart Below - Top Panel - Red Trendline); usually that kind of situation bring more volatility to US financial assets and a risk eventually of a correction like December 2014, August 2015 and January 2016... (See Second Chart Below - Top Panel - Lower Grey Trendline)


​Read Also: Dollar Sinks on Fed as Emerging Markets Rise With Yen; Oil Gains 


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Louis Pasteur
"Chance favors the prepared mind." 



SP500 and the Yen: A Warning Sign?  $SPY,  $USDJPY #Trading #investing #yen #SP500




DAILY
YEN (USDJPY - Candles - Top Panel ) 
Correlation between Yen and SP500 Index ( Blue Area - Second Panel )
​SP500 Index ( Bars - Third Panel )
Nikkei 225 Index ( Bars - Fourth Panel )








MONTHLY
​YEN (USDJPY - Candles - Top Panel )

SP500 Index ( Bars - Bottom Panel  )


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