EUR/USD: Euro remains on defense below 1.0900 as it is struggled to react

The single European currency continues to be under question as it takes slight losses for the third day in a row failing to return to upward momentum with some limited reactions being all it can bring to the table for now.

Yesterday's agenda did not bring any surprises with the announcements being close to the estimates thus maintaining the general picture of the market without particular changes.

The prospect of a reduction in interest rates from  Fed and Ecb continue to monopolize the interest of investors. Relatively unchanged compared to yesterday remains the prospect of a 25 basis points rate cut from Fed on the next meeting as the possibility of 50 basis points that was on the table 2 weeks earlier is now out of the agenda.

This development is considered one of the main catalysts that has strengthened the American currency in last 3  weeks as although the cycle of interest rate cuts continues by both main Central Banks the gap remains clearly in favor of  US currency.

At the same time, geopolitical concerns remain high on the agenda, which supports the US dollar, which traditionally functions as a safe haven currency.

On the concerns over the Μiddle Εast front and a possible escalation adds the developments between China and Taiwan that could ignite a new front of geopolitical tensions.

Today's agenda is relatively poor as  includes very few announcements without any of them being considered high profile , while the only thing that stands out is a speech by President Christine Lagarde, which is in any case overshadowed by tomorrow's meeting of the European Central Bank with  the decision to reduce interest rates which will probably be by 25 basis points and the speech of President Lagarde that will follow.

Beyond some limited-scale reactions and pending tomorrow's Ecb meeting  the European currency is likely to continue to struggle to show something better on the table.

On the other hand as long as the exchange rate falls well below the 1,10 level it is likely that the recent gains of the US dollar will soon be called into question with signs of fatigue appearing on the table.

With this thoughts I remain on hold and my attention is now focused on the prospect of buying the European currency,  maybe near to  1,08 level.