As you can see from the hourly chart, volume has picked up since the earthquake and tsunami on March 11. Notice the spike lower last night in the currency pair which took out the previous high of 79.75, reached in April 1995 in the wake of an earthquake that devastated the city of Kobe. I get the sense that the Bank of Japan is going to let the speculators jump in and keep driving the currency pair (USD/JPY) lower so that it can intervene later and cause heavy losses to the speculators. I also think that the BOJ is waiting for a meeting with its G7 counterparts, which will begin at 7 a.m. Tokyo time, to get their blessings or even help in a co-ordinated fashion to intervene in the currency markets. Elsewhere, the Euro moved over the 1.40 level on solid demand at a Spanish bond auction and on the view euro zone interest rates may rise as soon as April. Meanwhile, the CHF continued to receive safe haven flows, which has pushed the CHF to record highs against the USD, even though the Swiss Central Bank kept interest rates on hold. In Canada, the CAD moved higher as oil prices headed higher on continued turmoil in the Middle East and North Africa. Clashes between security forces, some brought in from Saudi Arabia and other Gulf states and anti-government protesters in Bahrain, caused oil prices to tick up because of worries that it could spark an escalation of a conflict between Sunni Saudis and Shiite Iran .
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