Forex Flash: EUR/USD to range-bound between 1.2800-1.3000 – Rabobank

FXstreet.com (Barcelona) - The euro is now giving away some profits, after climbing as high as the very doorsteps of the key psychological resistance at 1.3000 on Friday, pushed this high by spiraling risk appetite sparked since Tuesday's lows in the mid 1.2700s.

According to Jane Foley, Senior Currency Strategist at Rabobank, the US 'fiscal cliff' and the likeliness of further easing by the Fed represents one side of the potential drivers for the cross in the near term, via the US dollar. The other half is comprised by the weakness arising from the euro zone fundamentals, Greece, Spain and this Sunday's elections in Catalonia.

"Insofar as we see a tangible risk of more Fed easing, potentially as early as the December 12 FOMC, we expect the USD to remain on the back foot into year end and early next year. That said, we do not expect the EUR to be able to gain much traction vs. the USD. This weekend's Catalan elections and weak economic growth in most of the Eurozone region suggests that over the next month or so EURUSD could remain contained mostly within a 1.28 to 1.30 range", she concluded.