EUR/USD: Most likely a calm trading day as all eyes on Fed

The single European currency for the second day in a row shows signs of stabilization but has not yet managed to register a stronger reaction.

During yesterday's day with the opening of the new week and European currency tried to create a mild upward trend which brought it close to the level of 1.07 but without managing to secure it.

Τhe echo of the previous week with the decision of the European Central Bank to raise interest rates but to limit the aggressive tone as most likely that the cycle of raising key interest rates has closed,  it remains in the atmosphere and continues to act as a counterweight on single European currency.

At the same time the international stock markets without showing signs of collapse are under question, there are liquidations and the slight climate of uncertainty certainly favors the US currency for now.

On today's agenda, the announcement on last revision for inflation in the eurozone stands out, where no surprises are expected. While later in noon we have the announcement for Housing Starts and Building Permits in US.

It is logical that all interest is concentrated on Fed's decision tomorrow about to increase or not the key interest rates with the bets being concentrated in favor of no increase but without excluding the surprise.

While It is very likely that the market will show more sensitivity to President Jerome Powell's statements and to the forecasts for the next moves of the Fed.

Although tomorrow carries significant risks and the possibility of more pressure on the euro remains in play I prefer to hold positions in favor of the euro for now as yesterday's mild reaction I feel is not enough.