Archived IMT (2010.03.17)

More yen weakness emerges as the Bank of Japan doubles its 3-month lending facility to Yen 20 trillion. Although the amount was within market expectations, the MoF has made its intentions clear to battle deflation and fight excessive yen strength. USDJPY is still seen breaking 91 and onto 92 w/in next week while AUDJPY breaks 80.40. While the SP500 / VIX ratio has breached above 65 on Tuesday, this pattern is identical to that of mid Jan when the ratio hovered around 65 before tumbling down by 38%upon the Jan-Feb decline in equities. Keep close watch over the ratio. A close above 65 by week's end would call for a resumption of the risk trade. Ashraf is on travel therefore frequence of updates will be less than usual.