EUR/USD is looking for a new direction after failing to break to higher ground. What’s next?

Here is their view, courtesy of eFXnews:

EUR/USD appreciated as of late, as softer-than-expected US data, a more dovish Fed and negative headlines on Trump’s policies fueled further short EUR/USD positioning unwinding.

In the near term, a quiet data calendar in Europe and the US is likely to keep EUR/USD range-bound amid elevated US political uncertainty but less stretched positioning.

European political risks and monetary policy divergence should push EUR/USD lower towards parity later in the year, in our view.

On the data front, we expect German IP to post modest growth at 0.4% m/m in December (Tuesday; consensus: 0.3% m/m; previous: 0.4% m/m). Finally, French IP should contract 0.7% m/m, in line with the consensus (Friday; previous: 2.3%).