Japan Yen growing stronger amid crisis?!

Hey everybody,
so for the past few days I have been keeping an eye on the exchange rate of the yen to USD because I am planning on moving to NYC in the Summer, and want to exchange my yen when the yen is fairly strong. I was expecting the worth of the yen to drop significantly after the disaster, but what I am noticing is that the yen is in fact growing stronger over the USD. Just a day or two ago, it was around 82-83 yen to 1 USD. currently, it is 79yen to a USD, and there was a spike going even to 76yen.
Can anyone explain this to me? I keep thinking it should be the other way around, but maybe someone can show me a reasonable explanation for this?
Here is a graph showing the exhange rate up until the point where there was a sudden drop to 76 yen.

As I understand it, it is mainly because of currency traders. They believe that Japan will sell off foreign investments (like US Treasuries) and in doing so will make the value of the Yen rise. They are buying Yen now to profit from the expected rise in value later. By buying Yen, they are selling other currencies, thus causing the value of the Yen to rise in relation to other currencies.

So, in your opinion, would the value keep growing? I want to know so I can exchange my money at the best time possible you know?

I am honestly not 100% sure if it will continue to rise in value, otherwise I would be putting my own money into Yen. However, if the Bank of Japan continues to inject more stimulus money into the markets, I don't think that this rise in value will last too long. Maybe think of converting some of your money now and then some later. Then you can take advantage of today's rate in case the Yen losses value by the time you move, but you still have the potential to get a better rate if the value increases. It really depends on how much money we are talking about, as a drop or rise of 5% doesn't really matter to an amount of say $10,000, but if we are talking about $100,000 or more, then I would be more inclined to convert more today. What you have to ask yourself is what is your risk tolerance and would you sleep better at night knowing that you already exchanged the money?

reply to post by oneinthesame


Haha of course. It looks like the yen is slowly going back down. Thanks for clearing that up for me.

reply to post by bulletproof_monk


Hey. I used to professionally trade currencies and have won many national stock trading competitions. Also predicted the stock market crash a month before it happened last year. When you watch ti as much has i do it all kinda just seems to repeat itself. Kind of sitting back and watching waves come in and out on a beach. Pretty much what the stock market does, s well as currency.

I think the worse things are in Japan, the higher the Yen will go. During times liek this in well developed countries people tend to take out cash, hold onto it, not invest it, and you get a period of accelerated deflation. Same thing happened when the stock market tumbled. We went through deflation for a short period until we began to recover.

In an economy as established as Japan, the Yen will likely do the opposite of what the Japanese stock market does. Market does poorly....Yen gains strength, Market recovers, Yen will lose strength. I think things will balance out and recover a bit once the major Japanese businesses get back to operation and things start to be looked at in the rear view mirror. But it may have a while to digest it. Probably after you move. I also expect a bit of a hit to the market when Quarterly expectations come in consistently lower due to this mess. Future outlooks for earnings and revenue will be reduced. All will just feed off each other..Less money this quarter means less money next quarter to generate revenue. So may be a year or two of reduced economic #s for Japan just from a little bit of work stoppage and delays now. Plus it takes time to stop a company and to get it goign again. Liek a giant steam engine. I think there is a good chance the Yen will continue to gain strength for a while as more bad news and bad earnings come out. Unlike the Stock crash a few years ago there isn't a big need to throw a trillion dollars at it to pretend nothing happened and to screw with the currency rates. With japan traders will accept it happened and let it take its natural course. There is a physical reason for the market dropping. Then again it may be artificially high right now due to all the panic. But i think the Yen will slowly lose some strength, maybe bounce around a bit, But i think it will retain a lot of the strength it has recently gained.