JPY Trading Outlook (05-11-2014)

USD/JPY The first post-QQE2 correction in the yen’s slide arrived today, but it was a mixed and muted affair compared to the manic yen selling the previous two sessions. USD/JPY’s ltd trading beyond 114 got some specs taking profits and a few J exporters willing to lob some in given the recent windfall versus their budgets. Hot and real money both took turns at scooping up intraday bargains in the low 113.00s. Even a poor US Trade report failed to have a lasting negative impact. There was a broad USD dip around the 10ET options expiries, but the hourly Cloud top has kept USD/JPY aloft in a tight range since. There was linkage to a Reuters story about ECB disunity, which may have helped, counterintuitively, lift the EUR and EUR/JPY on the fear the ECB will have a harder time getting to QE and rapid balance sheet expansion; a glaring contrast to the BOJ’s QQE2. EUR/JPY is making new post QQE2 highs with little historical resistance until April peak at 143.47. AUD/JPY got RS & techs boosts o/n, but CAD/JPY yen struggled on further carnage in energy prices and a pending double-top by the May highs. Kuroda’s Tokyo speech tonight is the next key event.