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Yes, the EUR/USD fell to a 2-month low at 1.2715, but it set back quickly to 1.2740 level on Thursday. A lot happened in the market today (Thursday): positive U.S. data, Greek approval of a new round of austerity measures, irrelevant rhetoric from Mario Draghi of the ECB, along with nose diving stocks and U.S. yields. But nothing is enough to make the EUR/USD move in the U.S. session lately.

As soon as New York opened today, the EUR/USD entered in a comatose consolidation. Previously, the euro pushed a little bit lower and set a fresh 2-month low of 1.2715 against the dollar after the European Central Bank decided to leave its monetary policy unchanged. In the subsequent speech, ECB President Draghi said that the bank is ready to act but it is up to the governments to request aid to Brussels.

On Wall Street, stocks advanced initially but gains vanished fast amid concerns on a possible fiscal crisis. This despite recent quotes of politicians calling for talks to avoid the fiscal cliff.

The Dow Jones Industrial Average fell 0.94% today, or 121.41 points to close at 12,811.32. The DJIA has declined 2.15% since Monday's open, around 281 pts. The S&P 500 lost 1.22% on the day to close at 1,377.51, 17.02 points below yesterday's close. The Nasdaq Composite dropped 41.71 points or 1.42% to close at 2,895.58.

Is the EUR/USD's bearish trend strong enough?

The market is giving much importance to the 1.2735/40 area as it is the lowest price of yesterday's daily candlestick as well as the 38.2% retracement of the 1.2040/1.3170 daily run. "While the pair posted a lower low of 1.2716, keeping the dominant bearish trend alive, there was no follow through, and we start the Asian session still hovering around the 1.2740 static Fibonacci level," comments Valeria Bednarik, FXstreet.com Chief analyst.

For the short term, "the hourly chart shows price contained by a slightly bearish 20 SMA while indicators retrace from their midlines, supporting the negative stance. In the 4 hours chart, technical readings are also bearish, with plenty of room to extend and with no aims to signal a reversal or even an upward correction," points Bednarik. "A break below 1.2710 will favor a quick fall towards 1.2660 area. The upside will remain capped as long as price stands below 1.2785 price zone."

On the big chart, RBS' analysts believe that the EUR/USD is heading lower by year-end. According to RBS' William Moore,"Our bias is still that this market heads lower into year-end and I till like selling any meaningful rallies, the levels highlighted yesterday at 1.2787, 1.2824 and more specifically 1.2884 are the stand outs. We would look to add to positions once the 1.2740 level is broken - note that yesterday's price action was an aggressive bearish engulfing candle."

Source: Forex: The Impassive EUR/USD Steady At 1.2740