EUR/USD: Euro in reaction mode above 1.1200 after the recent two-day losses

The single European currency has returned clearly above  1,12 level after temporarily breaking down below during Asian sesion in an environment where the US currency is trying to return to the spotlight but is not yet shining.

The calm that has come to the markets after the turbulent period with President Trump's policy of imposing huge tariffs on key trading partners has helped the dollar, which had been in a state of intense doubt.

However, the controversial personality of President Donald Trump remains a significant concern for investors, the possibility of significant reversals has not disappeared and for this reason many remain extremely cautious.

The open front that President Trump has opened with Fed Chairman Jerome Powell remains unresolved as the US President strongly questioned the Fed's recent decision to keep key interest rates unchanged.

The yields on US government debt securities, after the recent significant rise in previous weeks, remain at stable levels, but in any case the prices are considered relatively high in relation to the level of key interest rates, something that has not removed from the agenda a possible further questioning of the US public debt.

President Trump's controversial policies and the potential impact on the credibility of the American economy with the possibility of a recession and the concerns regarding the course of public debt currently remain the main obstacles in the American currency's attempt to move to even higher prices, with levels below 1.10 currently be a significant challenge.

Today's agenda is quite poor in terms of macroeconomic announcements, but it is extremely stormy in terms of statements from Fed officials, as about 9 of its members have various statements.

The ongoing correction in the exchange rate further confirmed my thoughts as expressed in previous articles as I gave a good chance to such a scenario although my fear of President Trump's enigmatic policies forced me to remain on the sidelines.

As the exchange rate correction approached 400 basis points from the recent highs of 1,1575, it is quite logical that the margins for further correction are narrowing, but isn't out of the agenta.

No changes in my thoughts ,  I prefer to remain on hold. A probability  that the consolidation behavior will continue and the exchange rate will maintained for the foreseeable future between 1,11 - 1,16 levels remains in the game.