Stay Long Yen

Greek/Bund spreads have blown out again. As I commented last month the market will look to take option b and push greece  into a default situation thereby testing the resolve of the Eurozone to come to thier rescue.

The latest polls in the UK again point to a hung parliment and to add insult to injury, the BIS has just released a scathing report on UK public finances....Now, if u add yesterdays reports of the serious problems faced by California, crude and commodities at years highs....  kinds  suggests  we  maybe in for  another dose of Risk off trading.

Keep an  eye  firmly on the US 10´s and the stocks... If stocks see another strong day of selling with the buying of 10 yr treasury notes Yen will reap the rewards.

On a technical note, daily charts on Yen pairs have all turned bearish. Shorter charts are a little oversold here but rallies should be sold into.