"Could you please add MXN.JPY cross rate to the chart library? I wonder what's your opinion on MXN.JPY, CAD.JPY and AUD.JPY. I like the short yen idea but don't like USD at this level. I prefer to short yen vs the high yield currencies. Thanks"

Eoin Treacy's view Thank you for this suggestion and I have added the rate to the Chart Library. The Chart Library has 17 Yen cross rates and the Yen's pattern of weakness is common to most of them. I agree that shorting the Yen against higher yielding currencies is more beneficial since you will be able to pick up the relative interest rate differential between the two currencies. However, retail investors may have to do quite a bit of shopping around before they can find a broker offering some of the more esoteric rates such as Mexican Peso / Yen.

The Canadian Dollar, Australian Dollar, Brazilian Real, South African Rand, Indian Rupee, Russian Ruble, Mexican Peso, Singapore Dollar and Korean Won have all been ranging against Yen for much of the last year and are now pressuring the upper side of their ranges. The South African Rand, Canadian Dollar and Korean Won have already broken upwards and downward dynamics would be required to question potential for continued Yen weakness. Of the leaders, even though South Africa has been cutting rates, at 6.5% it still offers a chunky yield. The upcoming World Cup may also see increased demand for the currency.

Just about every currency has a positive interest rate differential when compared with the Yen, making it relatively cheap to short. This is even more the case in countries where interest rates are rising. With the prospect of continued Yen weakness increasing against a large basket of currencies, the Yen is likely to return to being the carry trade funding currency of choice for leveraged investors.