G7 Yen Intervention Has Saved Stocks: Charts

The stock markets "have been saved" by the yen weakness that has sprung from the G7 intervention in March, when the world's major central banks acted jointly to push down the Japanese currency's value, according to Chris Zwermann, global strategist at Zwermann Financial.

Zwermann noted the correlation between the Dow Jones Industrial Average and the dollar/yen cross since the tragic Japanese earthquake and tsunami on March 11.

"We see the yen weakening even more and the market really has understood that it can take the yen as a carry (trade), especially on US dollar/yen and also the yen compared to other currencies," he told CNBC.

The same can be seen in the correlations between Germany's DAX index and the euro/yen cross , "except it turned around a bit later," Zwermann added.

He said that the euro/yen will carry on trading upwards, and the DAX will follow suit.

"This is going to continue because the market is really financing itself at the moment in the yen," he said.

The DAX's upward trend since 2009 was recently tested by a small retracement but has continued its bullish trend, Zwermann said.

"The upward trend is now intact. And as soon as we jump above 7,230, which was the May 2008 high, we see new highs going in the direction of 8,150," he advised.

The Brazilian real's 6 percent gain against the yen last week has given the country's stock market a much-needed boost, Zwermann told CNBC.

He has a target for the Bovespa of 72,000 and suggested it reach "new historical highs" later on.

"It's powered by global dollar weakness as well as yen weakness. So it's a currency-driven market, I guess," he said.

Sterling is set to rise against the dollar after breaking above the 1.6050, according to Zwermann. He has a target of $1.73, or possibly even 1.85 "in three-quarters-of-a-year's time."