EUR/USD: Euro remains in the spotlight just above 1.0500 level but barriers are still in play

The single European currency is trading near the 1,05 level in the early hours of Tuesday, but further gains remain a significant challenge as the barriers that have weighed on the European currency in recent months remain in play.

Despite the stormy developments at the geopolitical level with a strong '' bras de fer '' between the European Union, the United States and President Zelensky, the general picture of the market remains without significant differences with the pattern of recent weeks remaining on the table.

This development has fully confirmed my thoughts as expressed in previous articles as I gave strong chances to the scenario of the exchange rate remaining at levels between the recent lows of 1,0175 and at levels just above 1,05.

But as the exchange rate has been compressed within its recent trading range, the likelihood of some abrupt decompression and a breakdown of critical levels is slowly starting to increase.

Geopolitical developments, President Trump's '' tariffs dance ''  and Central Banks decisions remain high on investors' agendas and will determine the course of the exchange rate in the near future.

Today's agenda is quite poor, with the only thing that stands out is the unemployment rate in the European Union and some speeches by Fed officials from the other side of the Atlantic.

Many investors are maintaining a wait-and-see attitude ahead of Thursday, when the European Central Bank is expected to cut key interest rates by 25 basis points, with little chance of a surprise.

But there is always a chance that President Christine Lagarde speech after the decision could give new messages and shake the markets.

I remain on hold, maintaining my thoughts on buying the US currency at some strong peak near the levels of 1,07.