The iShares MSCI Japan Index (NYSEArca: EWJ) is on a four-day losing streak that has pushed the ETF below its 50-day moving average. Yet stepping back, the Japan fund is trying to form a rising channel after underperforming for most of the year.

Economic Minister of Japan Seiji Maehara pledged a closer watch over the central bank to ensure it meets a 1 % inflation goal, adding that purchases of foreign bonds may be a powerful tool for easing, reports Mayumi Otsuma for Bloomberg BusinessWeek. Prime Minister Yoshihiko Noda reshuffled his cabinet ahead of an election that may come as early as this year, causing investors to look forward to any policy shifts.

The overall weakness in the export market will create a stronger case for a bond-buying program for The Central Bank of Japan.

Future currency interventions, similar to those implemented after the tsunami and Fukushima nuclear disaster will also be considered to keep the yen level under control.

EWJ, the Japan ETF, is about flat for 2012 to lag the U.S. market as measured by the S&P 500, which is up about 17%.

Investors have been pulling money from EWJ lately. [ETF Chart of the Day: Japan]

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