It's true that the eurogroup meeting was a fiasco, but the euro remains untouchable at 1.2820 against the dollar. The EUR/USD closed its third positive day in a row, but the gain was just another 10-pip advance from the opening price.
Early in the session, the battle was fierce. The EUR/USD collapsed to 1.2735 following the no-news eurogroup meeting, but the pair bounced from lows and returned to the 1.2800 comfort zone, where it has been trading within the American session hours. It hit a new two-week high of 1.2831 during the American session.
Lately, the euro seems detached from fundamentals. Despite the fact that eurozone woes are far from over and no decision has been made on Greek debt or a Spanish bailout, the EUR/USD continues to find buyers on dips. "With Eurogroup finance ministers unable to come to an agreement on Greece, the EURUSD has remained in relative consolidation for the second day in a row," notes Richard Lee, an FXstreet.com analyst.
"The range trade has kept hopes alive that the single currency could be privy to some upside potential very soon. But even as policymakers are scheduled to reconvene on November 26th to decide the fate of Greece, there is ample opportunity for euro bears to pounce," adds Lee, who commented on the possibility of an "Epic Fail" for the euro.
As for the short term, thin trade and bouts of volatility are thus expected throughout the rest of the week, as Friday's session will be shorter than usual. However, a EUR/USD bullish tone persists, "with the pair trading at fresh weekly high and nearing 1.2840, a 38.2% retracement of the latest daily fall," comments FXstreet.com Chief Analyst Valeria Bednarik. "Steady gains above this last will expose the 1.2890/1.2900 static resistance zone."
There are "frustrating ranges" persisting in the EUR/USD, comments RBS' Technical Markets Strategist William Moore. "The short-term range between 1.2806 and 1.2742 looks under threat -- as this was defined by the important low on October 1, and the 38.2% retracement from the July-September rally. In line with the recent ranges, this looks [like a] good value for a small long here... expecting a 40/50 pip run back to 1.2806+, where the fade once again becomes the chosen strategy," Moore suggests.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.