It won’t go up, but it isn’t going down either. The EUR has remained in a very tight intraday trading range of 1.3145 – 1.3185.
Technically, a break of 1.3185 tests resistance at 1.3200, which is a psychological level and then the 1.3240 area. Support emerges at 1.3140, then 1.3120.
With no real news on the horizon to influence the single currency, focus remains on the fiscal cliff. House leader Boehmer made a surprise 40 minute visit to the White House this morning, but nothing much has come from that. Most analysts expect a deal sooner rather than later and when that deal comes it will most likely spur USD selling. I think the deal will be a risk-on event, but the move won’t be too dramatic as the end of the cliff has been priced into the market.
It’s December and most trading rooms are winding down. My biggest concern for these last two weeks is liquidity. I think that will be the main focus as we move towards December 31
Further reading: EUR/USD forecast.
