EUR/USD: ECB and Fed unable to provide direction, murky landscape remains

Τhe single European currency has returned to levels of 1,06 as it has absorbed yesterday's losses where it approached the level of 1, 05.

Yesterday although it was characterized by intense volatility in both directions but ultimately did not have any surprises, the Fed kept key interest rates at the same level while Chairman Jerome Powell did not bring anything new to the table that could help investors get big bets.

Without being high, some small chances remain on the table that the central bank of the United States has not definitively closed the cycle of interest rate increases,  the next data on the course of inflation and whether the American economy maintains a satisfactory growth rate will be critical for this decision.

Currently the landscape remains cloudy and this is clearly reflected in the exchange rate where it remains stuck between the 1,05  - 1, 07 levels even after the two crucial Central Banks meetings as no clear message has come to the table.

The two main catalysts that continue to weigh on the European currency, the better course of the US economy and the ongoing geopolitical concern remain on the table. But nevertheless, the European currency retains the characteristic of good reactions and gives the feeling that once the trigger is present it will be able to restore an upward Momentum with relative ease.

Today's agenda without being uninteresting has no strong macroeconomic data and interest is limited to the unemployment figures in Germany as well as the weekly jobless claims in the United States but certainly all overshadowed by tomorrow's new jobs announcement in the US where it is expected with great interest and traditionally if there are some significant deviations there is very high volatility in the foreign exchange market.

The upward movement of the European currency in the wake of the Fed meeting reminded the Euro's characteristic of achieving good reactions, confirming my thinking as once again captured in yesterday's article although I expected even lower prices in order to position myself in favor of the Euro.

Currently there doesn't appear to be any strong direction on the horizon And especially before tomorrow's US jobs data  it would be surprising if the exchange rate changed significantly from current levels.

For the exchange rate to remain close to the 1,06 level with some significant deviations on either side is a realistic scenario by tomorrow and  before NFP data.