The U.S. dollar continues to muster a bear market rally this spring with big gains overnight in Europe, Asia and the Americas. But as this rally eventually runs out of gas, look to the Asian currencies as the best long-term value as the revaluation theme accelerates.

Asia is home to the world’s most distorted currency values whereby bulging foreign exchange reserves combined with rising savings rates make these countries exceptionally undervalued versus the U.S. dollar. Over the next several years these units will continue to revalue against the dollar – a trend that started in 2005 following China’s historical revaluation of the yuan.

The best currency values now in Asia include the Japanese yen, Chinese yuan, Indian rupee, Malaysian ringgit, South Korean won and, my favorite by far, the Singapore dollar.

The Malaysian ringgit’s value, however, is still set by the government since the Asian economic crisis ten years ago; the good news is that signs are emerging that the Malaysian central bank will soon ease foreign exchange controls. If that happens, buy the ringgit because it’s dirt cheap. China’s currency is not convertible, though there is no doubt at some point the central bank will merge both the yuan and the remnimbi.

The above Asian markets, including Japan, still provide a great avenue to diversify out of U.S. dollars. I’d avoid dumping dollars for European currencies now and continue to accumulate select Asian units and gold.

One of the best and most convenient ways to hold a basket of top-flight Asian currencies is to purchase the Sovereign Society Asian Currency Portfolio at Everbank. This product, FDIC-insured, offers a diversified portfolio of Japanese yen, Indian rupee, Chinese yuan, Australian dollars and the Singapore dollar. Since launch last August, the portfolio is up 9% versus a 5.4% loss for the S&P 500 Index and a 3.9% loss for the MSCI World Index over the same period.

Investors, however, beware: Asia does have a few currency blotches.

I’d avoid buying the Thai baht amid renewed unrest lately and the Vietnamese dong – victimized by skyrocketing inflation this year. Also, Indonesia is still wresting with local unrest caused by terrorist activities in the south.

The U.S. dollar won’t muster a long-term secular rally from these levels. The conditions are simply not in place for a sustained dollar rally in the midst of severe housing deflation and bank credit contraction. It’s absurd to believe the Federal Reserve will start raising lending rates in this environment – unless it seeks to destroy the economy, which is not the case. Use any intermittent dollar strength this spring and summer to buy select Asian currencies and gold.