EUR/USD: Euro's last week's bullish momentum can be challenged in a calm agenda

The single European currency is trading in a narrow range around to 1,0750 level in the early hours of the new week as last week's strong bullish momentum which peaking on Friday in the wake of disappointing US jobs news shows signs of fatigue.

Now the ability of the US currency to move significantly higher by breaking down the 1,06 level has been questioned as last week several macroeconomic data from the United States disappointed and investors did not appear willing to take big bets in favor of the US currency.

Τhe ability of the euro to react remains on the table with very good fidelity confirming the strategy to buy the euro on dips.

The data on the labor market in the United States that were announced on Friday although disappointing i think they are still not at levels that will raise concerns and question the soft landing mode for the US economy.

The European currency for the third week in a row closed in positive territory having now moved well away from the critical levels of 1,06 although I maintain significant doubts as to whether the positive momentum will be able to continue further.

Αs it turned out, on Friday near the level of 1,08 several buyers appeared in favor of the American currency as the interest rate difference between the euro and the dollar remains on the table, which is likely to widen further in June.

Αs long as the prospect of a widening interest rate spread remains on the table and US bond yields are moving at good levels the European currency will find significant obstacles to recover and stay easily above the 1,10 levels.

Today's genta is relatively poor and the only thing that stands out is the investors confidence index in the eurozone as on the other side of the Atlantic beyond some statements by Fed's officials there is no announcements of macroeconomic news.

I would give a good chance on the scenario that today's trading range will remain confined between the 1,07 - 1,08 levels with any possible extension either side of these levels being difficult to sustain.