* Dollar stalls just before 100 yen, euro before 130 yen
* Yen recovers after hitting near 4-year low versus dollar
* Yen falls seen temporary after aggressive BOJ easing
* Talk of dollar offers near 100 yen, stops and offers above
By Jessica Mortimer
LONDON, April 9 The dollar stalled on Tuesday
just shy of 100 yen after hitting a new four-year high but its
rise against the Japanese currency appeared inexorable following
aggressive easing measures by the Bank of Japan.
The dollar was last down 0.4 percent on the day at 98.98 yen
, having earlier risen as far as 99.67 yen, its highest
since May 2009.
Traders reported a large options barrier at 100 yen, which
could mean the dollar initially struggles to vault this level.
Still, analysts said this was only a pause as traders took
profits and it was a matter of time before the yen broke lower
"Dollar/yen has moved so quickly it is bound to have
setbacks ahead of key levels, so I am not surprised it is not
just flying through the 100 mark," said Niels Christensen,
currency strategist at Nordea in Copenhagen.
"Investors have been quick to use any setback to put on new
short yen positions so I don't think it will continue.
Everything is pointing to a weaker yen and everyone is happy to
go with the flow."
Traders also cited strong demand to take profit on dollar
gains ahead of a level around 99.73 yen, the 50 percent
retracement of the dollar's fall from the June 2007 peak of
124.14 yen to a record low of 75.311 yen set in October 2011.
While stop-loss dollar buying was likely to emerge if the
U.S. currency rises above 100 yen, dollar offers were also
lurking above that threshold.
Since BOJ Governor Haruhiko Kuroda promised on Thursday to
inject about $1.4 trillion into the economy in less than two
years, the dollar has gained more than 7 percent against the yen
while Japanese stocks have jumped.
The euro hit 129.935 yen on the EBS trading
platform, its highest since January 2010, before stalling just
before 130 yen. It last traded down 0.5 percent at 128.55 yen.
Traders said large stop-loss buy orders would be triggered
if the euro broke through 130 yen.
Japanese Finance Minister Taro Aso said on Tuesday that the
yen was undergoing a correction from previous "excessive" rises,
though he stressed the country's monetary policy was aimed at
beating deflation not weakening the yen.
"For USD/JPY, upside momentum remains strong and an eventual
test of 100.00 seems in the cards," said Vassili Serebriakov,
strategist at BNP Paribas.
"Markets are increasingly focused on the notion that larger
JGB (Japanese government bond) purchases at longer maturities by
the BOJ could push Japanese domestic long-term investors
A trader for a Japanese bank in Bangkok said the dollar
could rise to about 110 yen this year, and about 105 yen in
three months' time, though this was likely to be determined by
the actions of Japanese institutional and retail investors.
The euro was up 0.1 percent at $1.3020, having hit a
three-week high of $1.3068 earlier after stop-loss buying was
triggered near $1.3050.
Analysts said the euro was helped by its strong rise against
the yen and by the more positive sentiment sparked by gains in
European equities. There was also a tendency to sell
dollars against currencies other than the yen after Friday's
weaker-than-expected U.S. jobs data.
Analysts said market participants not focusing on euro zone
concerns in the wake of a bailout for Cyprus and political
uncertainty in Italy.
Higher-yielding commodity currencies, which tend to benefit
when equities rise, hit multi-year highs against the yen.
The Australian dollar hit its highest since July 2008 at
103.81 yen and the New Zealand dollar rose to its
highest since February 2008 at 84.49 yen.