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The Yen has a decent track record in helping investors construct their portfolios towards the Risk on or Risk off trade! The yen is on a 20-year support line right now (monthly basis) at (2) in the chart above.
On a daily basis the Yen has formed a pennant pattern at (3). If the Yen breaks to the upside of this pennant pattern, the message would be the “Risk Off” trade is at hand and investors should underweight their portfolios towards risk assets.
Stay tuned and keep a keen eye on the Yen’s pennant pattern…what it does from here will send a key message about portfolio construction!