Chart Book | Chart of the day: Dollar weakness signals yen strength

Guess which global safe haven asset has fallen sharply this month despite the massive volatility that has whipped through the emerging market and commodity currencies? Look no further than the mighty US dollar, which is down about 6 per cent against major currencies during the period. So it seems only logical to focus on the Japanese yen to gauge whether, as in 2007-08, it might be about to recover its former "safe haven" status as a consequence. An irregular double top against the psychological level of 125 yen per dollar and above trend-line resistance since 1990 looks like an extension. This week's sudden sell-off that saw the currency break below this line sees moving averages poised to turn bearish while trading very close to January's lows. The cloud is supportive, as is the trend line from late 2012. Were these to give way, expect a sudden slump towards 107.