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Need a breather from all the Cyprus and euro zone drama? I have identified three possible reasons why the yen could get some support from the currency bulls this week:

1. Japan’s Fiscal Year Ends This Week

March 31 marks the end of fiscal year for Japan. This means that a lot of yen traders are probably going to take profits on their trades before they close their annual books. If we take a look at USD/JPY’s price action for the past three years we can see that price usually retraces at least some of the moves that it had made from January to the last week of March.

USD/JPY Daily Chart

In 2010 the pair shot up by 240 pips in 10 days after experiencing a downtrend since the start of the year. In 2011 Japan’s earthquake and tsunami disaster and the subsequent G7 currency intervention dragged USD/JPY by 400 pips, a move that was promptly reversed in the last week of March.

Profit-taking flows was a bit tamer in 2012 as the pair only fell by 150 pips from March 20-March 30 after rising by more than 600 pips since the start of the year. This time around USD/JPY is up by 760 pips since January. Will we see at least a 100-pip retracement?

2. Kuroda Won’t Be Talking Down the Yen at Least until Next Week

I’ve warned about this before. Kuroda, the new BOJ Governor, disappointed in his maiden speech last week. Apparently, instead of giving a specific plan of action on future monetary policy, Kuroda simply reiterated what he had been saying about his views on the inflation target and the BOJ’s commitment. Then, earlier today, Kuroda once again recited the same-old 2% inflation pledge. As expected, the yen didn’t react much, as no real details have been revealed.

With the BOJ meeting coming up this week, we could see traders start taking profit on their yen shorts, which could lead to a fall in USD/JPY.

3. Safe Haven Flows are Limited

Let’s face it: the only reason the euro and other higher-yielding currencies have been rallying as of late is due to temporary factors.

For instance, in the euro zone, a solution was finally found by Cyprus’ government to receive a bailout. Meanwhile, in the U.K., the persistent non-action from the BOE with regards to further QE and the positive retail sales data have provided relief for the pound.

As for the commodity-based currencies, they were helped by the better-than-expected Chinese PMI and the not-so-dovish RBA meeting minutes.

Optimism from these events could soon fade, which could put focus back on risk aversion.