* Yen under pressure on speculation of BOJ easing
* RSI puts dollar/yen in overbought territory
* Abe "magic" may run out by U.S. Thanksgiving - analyst
* Euro supported by cautious optimism on Greece
TOKYO, Nov 21 (Reuters) - The yen slumped to 7-1/2-month lows against the dollar on Wednesday and fell nearly as far against the euro on views Japan's central bank will be pushed into implementing more radical monetary expansion policies.
The euro held near two-week highs against the dollar, helped by hopes that euro zone finance ministers will agree to unblock aid to Greece after their ongoing discussions on ways to reduce the country's debt to sustainable levels.
The dollar rose to as high as 81.955 yen, a level not seen since early April, with its advance blocked by selling related to hedging for an options barrier at 82 yen, though a break there should trigger more short-covering.
It last stood at 81.90 yen, a gain of 0.2 percent from late U.S. levels.
The yen was also undermined by data showing Japan's exports fell more than expected in October, cementing worries the country is in for a recession in the current quarter.
"The data was not just worse than expected but also underscored the poor state of the economy. The yen's downtrend seems pretty solid now," said Katsunori Kitakura, associate general manager of market making at Sumitomo Trust Bank.
The yen hit its lowest level since April/May against many currencies. The euro also hit a 6-1/2-month high of 104.99 yen and last stood at 104.92 yen, up 0.2 percent on the day.
The yen has been falling sharply after Prime Minister Yoshihko Noda called an election on Dec. 16 and the main opposition leader, a front-runner to become the next premier, is pushing the Bank of Japan for more aggressive monetary stimulus.
Shinzo Abe, the leader of the Liberal Democratic Party, has put monetary policy at the centre of debate ahead of the election, calling for "unlimited easing", pushing rates below zero, directly underwriting bonds issued to fund public works, and setting an inflation target as high as 3 percent.
While sentiment over the yen is weak, oscillators such as the relative strength index are showing signs the yen may be oversold in the short-term and some analysts say the latest bout of yen weakness may be coming to an end soon.
"Abe now has few other things left to say about monetary policy. It's about the time the power of his magic runs out," said Daisuke Uno, chief strategist at Sumitomo Mitsui Banking Corp, adding that the yen's slide will likely have run its course by the U.S. Thanksgiving holiday on Thursday.
The euro stood at $1.2810, near a two-week high of $1.28295 set on Tuesday as the market looked to the ongoing meeting of euro zone finance ministers with hope of progress on a deal to support Greece.
Still, the common currency is expected to stay under pressure from the spectre of recession in the euro zone and uncertainty over Spain, which has not yet requested financial aid and faces a secessionist threat in a regional election on Sunday in Catalonia.
On the other hand, concerns that the U.S. economy faces a risk of recession if lawmakers fail to agree on measures to defer a fiscal crunch due to kick in early next year have supported the dollar, the vast liquidity of which makes it an investors' safe haven at times of crisis.
U.S. Federal Reserve Chairman Ben Bernanke said on Tuesday the Fed does not have the tools to offset the impact of a worst case "fiscal cliff" scenario.
He maintained his guidance that U.S. monetary policy would stay loose with interest rates near zero until at least mid-2015.
But he offered few clues, however, on how the Fed might tweak its bond-purchase programme at the start of next year in its effort to spur more borrowing at low interest rates.