The CurrencyShares Japanese Yen Trust (FXY) closed at a record high of $114.10 last Wednesday, before selling off steadily as risk appetite returned to global financial markets. Nevertheless, the Japanese yen continues its strong uptrend as the carry trade continues to unwind.
Your position in PowerShares DB Commodity Double Short ETN (DEE) soared 9.2% as commodities prices resumed their downtrend. Worries about slowing demand for commodities in the face of a global recession drove oil and base metals commodities prices lower. Oil stayed below $40 in spite of OPEC’s production cut last week. Copper fell and tin dropped below the $10,000 a ton level for the first time since January 2007. As the chart below indicates, commodities prices remain in a strong downtrend, which is bullish for your position in DEE.
You should feel comfortable in adding to each of your positions here.
Portfolio Update
The WisdomTree Dreyfus Chinese Yuan Fund (CYB) fell slightly as China’s foreign exchange reserves shrank in October to less than $1.89 trillion, their first monthly fall since December 2003. Given the faster than expected slowing of the Chinese economy, I am keeping CYB at a HOLD.
PowerShares DB Commodity Double Short ETN (DEE) soared to $78.91 as the fall in commodity prices resumed its downtrend. With demand for commodities continuing to falter in China, this leveraged bet on a drop in commodity prices has resumed its uptrend. Tighten your stop to $60.00. DEE is a BUY.
The CurrencyShares Japanese Yen Trust (FXY) closed at yet another record high of $114.10 last week, before retreating slightly. This is a minor, short-term correction in an otherwise strong and steady upward trend. Tighten your stop to $104.00. The yen remains a BUY.
The Rydex Managed Futures Strategy Fund (RYMFX) crept back over the $29.00 mark this past week, and then stuck in a very steady trading range. The long-term direction of this strategy is steadily upward. Nevertheless, I am keeping RYMFX at a HOLD.
Finally, I want to let you know that I’ll be spending some time with my family next week over the holiday season. So you will receive your next Global Stock Investor Hotline Update in the first week of 2009.
I wish you a Merry Christmas, and a bountiful and profitable New Year!
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