USDJPY has traded lower 15-20 pips.......>

DOLLAR-YEN: USDJPY has traded lower 15-20 pips lower in early Asia-Pacific

dealing, touching session lows of 110.72, last 110.75.

- Japanese retail liquidation in TRYJPY may have provided the initial impetus

for JPY to edge higher, according to sources.

- USDJPY now sits between two chunky options expiries, with some $2.0bln worth

of 110.00 & $1.4bln worth of 111.00 options set to roll off at today's 10AM NY

cut.

- Initial support lies at the 55-WMA (110.44), while resistance can be found at

the May 21 high (111.39).

- USDJPY tried to break through the upper 1% volatility band on Monday but was

frustrated by resistance from 111.40, just in front of the Jan 18 high (111.48).

The subsequent 'shooting star' close on the daily chart raises some concerns, so

eyes initially turn to 110.80-Y110.61 support. Loss of the latter would weaken

the immediate upside argument and put pressure back on 110.35. Main support

still come in the form of the 2 month bull channel base at 109.95.