Rabobank - "Yesterday’s release of stronger than expected US retail sales data has had the effect of boosting risk appetite and providing a little further lift under EUR/USD.  That said, this currency pair has been range trading for around a month now and there is every reason to fear that more of the same could sustain for some time yet."

"While we still anticipate that an increase in tension in Spain could force pullbacks in EUR/USD, we now expect these to be limited to the EUR/USD1.2800 area on a 1 mth view, with EUR/USD potentially remaining essentially range driven into year-end.  Given speculation that the fiscal cliff will ensure the Fed retains an easing bias we expect the USD to remain soft and medium-term forecast a move higher towards EUR/USD1.3500." Jane Foley, Senior Currency Strategist at Rabobank.