USD/JPY recovered from an 8-day low of 113.57 to hit a 2-day high of 114.71 on signs of political instability in Japan, technical support and talk that a major options play near 115.05 was expiring today. Gains in USD/JPY were aided by gains in EUR/JPY as well. The pair was supported by at lackluster performance in the Nikkei as well as reports that only 1.1% of Japanese citizens want PM Yoshiro Mori to retain his office after the July election. The pair halted its advance at 114.70, upside target of a Gann 50-point pivot. Next good resistance is at 115.08, the matching highs of Dec. 29 and Jan. 2. The Dec. 29 high marked a 16-mo high. The outlook is bullish. Support: 114.20 (Gann 50-point pivot; targets: 113.70/114.70), 113.57 (overnight low), 112.90 (Gann 50-point pivot; targets: 112.40/113.40), 111.60 (Gann 50-point pivot; targets: 111.10/112.10), 110.35 (Gann 50-point pivot; targets: 109.85/110.85), 112.74 (20-day moving average). Resistance: 114.70 (upside target of 114.20 Gann 50-point pivot), 114.71 (overnight high), 115.08 (Dec. 29 and Jan. 2 highs; 16-month high), 116.10 (target of bull flag formed since Nov. 3), 116.40 (Aug. 13, 1999, peak). * EUR/JPY helped pave the way for gains in EUR/USD as it recovered from a 9-day low of 105.28. The cross-currency rebounded on short covering and the EUR's natural recovery after the Fed rate cut, as well as on mounting signs of political instability in Japan. A German account was a noted buyer. Resistance is at 108.80. The outlook is mixed to slightly bullish. Support: 105.28 (overnight low), 104.86 (support line rising since Dec. 12), 103.25 (20-day moving average), 97.76 (200-day moving average), 97.73 (200-day moving average), 96.53 (60-day moving average). Resistance: 108.80 (overnight high), 109.48 (Jan. 3 high; 10 1/2-month high), 111.99 (Feb. 23 peak).