Nov 20 (Reuters) - EUR/USD's failure to break out on both the upside and the downside in the last few weeks may well result in a return toward the middle of recent ranges.

September's rally failed 62 pips before 2023's high at 1.1276 while November's plunge stopped 48 pips shy of last year's 1.0448 low. Both moves impressed speculators who ploughed money into bullish bets before turning short, and traders also turned to options to cover the risk of bigger moves, with volatility almost doubling as a result of their hedging.

As a consequence, traders are much better prepared for bigger moves, which have not been seen since 2022, and those now short are being frustrated by a rebound that reached 1.0610 on November 20.

EUR/USD, overbought when it peaked in September, was oversold when it based last week, and the chart formation where the weekly Ichimoku cloud twists near 1.0800 at the start of 2025 is a concern, because twists often attract.

Traders had good reason to cover the risk of a drop and equally good cause to fear a rise a few weeks ago. But they may instead see a return of the status quo as EUR/USD heads back toward 1.0750 - the midpoint of the area where most trading has occurred for two years - or 1.0855, which is the centre of this year's range.

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(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

((jeremy.boulton@thomsonreuters.com))