JPY Trading Outlook (26-02-2015)

USD/JPY Selling in USD/JPY ran out of steam in Asia as longs taken ahead of Tuesday’s Yellen appearance had been flushed out and importer/spec bids ahead of the converged 21-DMA and Kijun at 118.57 reversed the tide. The NorAm recovery got a few stops above the tenkan by 119, but without a good reason from US data or round II from Yellen, 119.07 all that could be mustered. Reports of a Japanese pension fund following the GPIF portfolio reallocation lead may also have helped weaken the yen a bit. Word on GPIF allocations at end Dec may be released before the week ends, providing more clarity on how far it has come in its reallocation process (basically out of JGB, into stocks and foreign assets). EUR/JPY was slightly former, though better gains were in the higher beta yen crosses, particularly AUD/JPY. It finally broke well beyond Kijun & Fibo hurdles by 93.35 and is pressing the down TL off the Nov & Jan highs at 94.02 last. GBP/JPY is also looking bullish, with a close above the 61.8% of the Dec-Feb slide at 184.23 a good prospect today. Weekly JPY investment flows are out tonight. There is a slew of key JPY econ data out Friday & a Kuroda speech.