EUR/USD: Euro on hold, below 1.1400 level ahead on stormy news

The single European currency is trading slightly below the 1.14 level in the early hours of Wednesday in a narrow trading range  pending critical macroeconomic data from the eurozone and the United States.

Yesterday, as expected, did not bring any surprises. The trading range was extremely narrow, only 20-30  basis points on either side of 1,14 level, as investors avoided taking large bets.

President Trump's enigmatic policy continues to be troubling and despite the milder tones of recent days confusion remains intense and  the dust has not yet settled from the recent developments about the trade war between China and the United States.

Yields on US government debt securities have declined significantly, alleviating fears of a major debt crisis in the United States for the time being.

This development is likely to give more breathing space to the American currency, which has recently been strongly questioned, with the pressure on US government debt securities being one of the reasons.

In general, the market picture does not show significant differences with the events that have monopolized investor interest lately remaining high on the agenda.

President Trump's controversial policy, despite the milder tones of recent days, continues to cause concern and currently remains the most important thorn in  American currency's effort to return to significantly higher prices.

The rhetoric of de-escalation of the trade war between the United States and China  is on going , have a positive effect on the course of  stock markets and has restored some calm , but investors remain cautious about the prospect of large bets in favor of the American currency.

Although geopolitical developments have monopolized investors' interest lately, the next few days with several critical macroeconomic data are likely to bring economic developments back to the table.

From today until Friday, culminating the new jobs in the United States, the agenda is extremely rich with a multitude of macroeconomic data for the Eurozone and US that are likely to give some new direction to the exchange rate.

My thinking remains the same, although I see some good possibility that the US dollar has room for further correction I prefer to remain on hold.