Forex: USD/JPY rallies on month end flows

FXstreet.com (Barcelona) - As November ends, market participants are increasing their trading flows, which in the case of the USDJPY provoked a rally from just above the 82.00 mark to 82.55, getting closer to Monday's high (82.62) and our 7-month high printed on Nov-22, at 82.84.

The agressive dovishness of LDP's Shinzo Abe, aiming at monetary easing until 2% inflation is seen, still ressonates in investors minds ahead of the Dec-16 election. BoJ's Shirakawa talked of easing yesterday too, aiming 1% inflation.

Japan economic calendar shows a jump in yearly based Construction Orders in October, from 3.6% to 29.1%. Housing Starts jumped from 15.5% to 25.2%, instead of easing to 10.1% as expected. Vehicle Production stayed contracting at -12.4%.

A small bull flag was broken and the USDJPY is now expected to challenge key resistance at 82.68/83.17 (78.6% retracement of the move seen this year and the 2011-2012 resistance line). "This is tough near term resistance for the market and we could well hold here again", wrote Commerzbank analyst Karen Jones, pointing to good support at 81.78 (April high)