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Trading a Moving Number

Japan’s Abe just gave every currency trader the green light to short the Yen!

Incoming Japanese Prime Minister Shinzo Abe reiterated calls for the Bank of Japan to conduct bold monetary easing to beat deflation by setting an inflation target of 2 percent.

Abe, to be sworn in as Japan’s next premier on Wednesday when he is also expected to name his cabinet, said his new government hopes to sign an agreement with the BOJ to aim for 2 percent inflation, double the central bank’s current target.

via Japan’s Abe: No Fiscal Reform Unless Deflation Is Defeated.

To accomplish this goal, Japan is going to have to print a lot of Yen. Those printing presses are going to go on day in and day out. Even digitally, as the government tries to introduce more of the currency to obtain velocity, the pressure to devalue will be enormous! Exporters are going to love this, that’s for sure. Maybe its time to go long something like Toyota or Sony? I know one thing, my screens will be focusing on USD/JPY and EUR/JPY and any other derivative for a while!

The Trading Gods talked to me last night

I couldn’t sleep last night. Six or seven times I kept waking up. Something was telling me to go to my desk and punch up my charts. I was frustrated and a bit angry that I couldn’t sleep.

“Meh…what the hell, why not?” I said to myself. Perhaps, looking at a bunch of boring stock or commodities charts at 3 am would finally put me to sleep. At best, I could still catch the European open and catch some action in the forex market.

Looking at an SPX daily chart, something told me to bring up some volatility studies and my old pals MACD and RSI.