FXStreet (Guatemala) - USD/JPY is drifting higher in a tight range on the 120 handle supported by 120.20 territory and has made a fresh high of 120.51 in the US session so far. We are consolidated in an even tighter range within the familiar ranges in a wind down into the New Year. When 2016 gets going, and so should volatility as there is plenty of uncertainty and volumes when positioning will return again from full desks. There are cases for long and short USD/JPY. The main themes will stay with commodity prices, the Fed and whether the BoJ will add any further stimulus in Q1? With Fed lifting off in December this year, Yellen has been clear that rate rises will be gradual. However, there are a number or arguments that the Fed might stay on hold in H1 or potentially for the entire year due to a number of variables and headwinds. Slack remains in the economy, especially the manufacturing sector whilst Global disinflationary pressures also remain. The BoJ on the other hand may also remain on hold, but the recent tactical moves may have been a signal that they are setting up for further explicit easing later in 2016. USD/JPY levels Technically, the familiar ranges remain with the price remaining within the cluster of daily moving averages. 123.88 recent highs mark upside potential while the downside on the wide is limited to 118.00 and 116.00 below that. The more immediate supports are 120.24, 119.64/94 while resistances are 120.75/05 and 121.36. For more information, read our latest forex news.