The yen has been in a downward spiral for weeks, and earlier on Friday it hit a new two-year low. Normally, that would suggest a trading plan.
But selling yen is just about the most popular currency trade these days, and short yen positions are enormous. Should you really pile in when a tidbit of positive news could cause a bout of short covering?
"It is getting a little crowded," says Boris Schlossberg, managing director at BK Asset Management, but "I still like the trade. I still think the trade is very sustainable into 2013."
That said, Schlossberg is a tad cautious. He wants to wait for the yen to recover slightly, and then sell. He suggests selling the yen against the dollar at 85.50 with a stop at 84.50. He wants to set an initial target of 86.00 "and then try to see if we can go all the way out to 88.00."