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After rallying in Europe but surrendering in the early American session, the EUR/USD is trading calm in a small range between 1.2930 and 1.2945. Is it just the calm before the storm? Risk sentiment is a little bit positive, and recent data seems to be anticipating a good U.S. employment report.

Earlier in Europe, the EUR/USD peaked at 1.2982 after encouraging data on the U.S. labor market lifted risk appetite, but failed to consolidate and then pulled back amid news that a Greek court ruled that pension reforms requested by the troika in order for Greece to secure more bailout cash may be unconstitutional.

In the American field, ADP, Jobless, ISM manufacturing, and construction spending has come out with good news for investors. "Given the recent upticks in employment through other external reports, expectations are looking for a positive gain in the U.S. labor market for the month of October," comments's analyst Richard Lee. "This is the last report before the U.S. Presidential Elections, and one that could help the near-term fortunes of the greenback."

In the short term, markets could expect little action for the current session, "with 1.2880/1.2950 the most likely range," states Valeria Bednarik, chief analyst at "Technical readings in the short term had turned neutral although negative, as price stands below 20 SMA and indicators below their midlines."

The Sideways EUR/USD Pre-Election

The EUR/USD trades at 1.2940 at the moment, "entering the Asian session around 1.2950 for third time in a row," adds Bednarik. "Range dominates the board, and market players remain reluctant ahead of tomorrows' U.S. NFP data and next week's Presidential elections, along with European Central Bank's decisions."

On a wider view, the EUR/USD remains inside a broader 1.2800/1.3170 range where it has traded since mid-September. In the absence of shocking news out from Europe, the pair will likely remain inside its weekly range, especially ahead of the U.S. Presidential elections.

Meanwhile, and again in the short term, the Bank of Tokyo Mitsubishi analysts are neutral on the prospects for EUR/USD, but remark that the Greek austerity vote is key to EUR/USD in the shorter view. The bank believes that the pair continues to remain in a consolidation phase, although that downside risks are rebuilding. In any case, the big event for direction will be the upcoming Presidential election.

Pay attention to Friday's Non Farm Payrolls, US unemployment report, and European manufacturing PMIs.

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.