EUR/USD starts the week locked up in suspect levels, with the USD finding bids on a negative lead taken by the S&P futures, down over -0.4% through Asian hours. This after reports confirmed that the NYSE trading floor would close on precautionary measures amid the threat of "Frankenstorm Sandy" approaching the U.S. East coast.
According to RANsquawk,
CME [is] also reporting that [it is] to close U.S. equity index futures and options... closing trading on futures on floor and Globex.
The Financial Times also published an article informing that the Chicago Mercantile Exchange would suspend floor trading on the Nymex oil market on Monday. The closures would result in a significant reduction in liquidity.
On the fundamental front, the calendar is vacant with no key first tier events to highlight. In the U.S. morning, Core Personal Consumption Expenditure data may see prices shaken out within well defined intra-day ranges.
Furthermore, traders will also keep an eye on a scheduled meeting - no time confirmed - between Italian president Mario Monti and Spanish Prime Minister Mariano Rajoy. Headlines could cause some volatility for euros.
A pair trapped in a range
EUR/USD is inside "a near-term $1.2880-$1.3030 range from a larger $1.28-$1.32 1-month band" notes Marc Chandler, Head of Currency Strategists at BBH. "The pattern by which the EUR moves in the opposite direction on Monday from Friday is nearly two months old, and if the pattern is to remain intact, the euro should rise on Monday," Marc notes.
Chris Capre, Founder at 2ndSkies, notes the pair is staying put inside a channel/triangle, and "since we are still midway through the triangle, I expect it to continue as we generally do not exit triangles till later on in the pattern," he says.
Valeria Bednarik, Chief Analyst at FXstreet.com, still defines the pair as a mix bag, "trapped between U.S. uncertainty over elections and European woes, the market still speculates on when Spain will ask for aid," she notes.
Joining the unanimous range calls, FXWW Founder Sean Lee also supports an extension of the familiar levels. Lee notes that since EUR/USD is still in broad range trading mode, trying to drive it out will likely continue to get traders hurt badly.
Elections and NFP to guarantee the range
"The elections in the U.S. will likely keep things tamed down a bit for the next few weeks" Chris adds, anticipating a continual reduction in volatility and tipping 1.2830-50 as area of value for buyers, while bears should consider enter around 1.3100.
Besides, with the U.S. NFP employment data later this week, Valeria can not help but also share Chris' view and anticipate that ranges are here to stay across the board this Monday. The analyst expect choppy movements unless a break below 1.2880, where she expects stops to be clustered.