JPY Trading Outlook (04-03-2015)

USD/JPY was already under pressure after Abe advisor Honda repeated comments about the yen already being cheap on a PPP basis by 120 and after the 120.27 Asia high ran into exporter and spec offers just before the well-defined dn TL off the Dec 23-onward highs. Japanese wage and OT data were also mildly bullish for the yen, but the major labor agreements for this year are not expected until March 18. 109.50 proved pivotal intraday, with stops run below it after the NY option cut at 10ET and after the Japanese Cabinet Office corp survey released o/n f/c USD/JPY for this year at 109.50 vs 105.7 last year. The breakeven for exporters is now put at 99 vs 92.2 last year. Japanese and other stock mkts were soggy, adding to the yen bid as carry trades got trimmed, but most of the price action is seen as book-squaring ahead of US NFP on Friday. Prices remain above the Tenkan at 119.28, and well above the Cloud top and Kijun at 118.71/57. EUR/JPY remains slightly above key Fibo support at 133.43. CAD/JPY is stuck below several hurdles at 96.26-41. Other crosses consolidated as wellt.