The single European currency is moving slightly higher having for the moment secured the level of 1,0850 but without breaking free from the extremely limited range of fluctuation of the last few days.

Investors remain cautious avoiding taking big bets as the exchange rate remains ''heavy'' and new strong data is needed for it to take a certain direction.

The general picture of the market remains the same, with the prospect of a change in monetary policy from the two main Central Banks continuing to monopolize interest and being one of the main causes affecting the exchange rate for now.

Yesterday did not give any surprise with President Lagarde simply confirming the reasoning that remains on the table lately that inflationary pressures are decreasing but there is still a way to go in order to reach the 2% target.

At the moment, for both Central Banks, most bets are on the possibility that they will make the first cut in key interest rates in June.

The US currency a few weeks earlier had been in the spotlight with aggressive rhetoric from President  Powell and increased inflation rates being the catalyst that helped the dollar to temporarily break the level of 1,07.

Since that moment and for 10 consecutive days the dust has settled, the American currency has not been able to continue its upper course, as a consequence the European currency has reacted satisfactorily and it has recovered more than 150-200  basis points with a mild upward trend.   Nevertheless, I believe that this movement cannot be characterized as a strength of the European currency, the market simply balanced out, investors seem to remain in a waiting position looking for the new catalyst that could create a strong direction.

On today's agenda the only thing that stands out is US Durable Goods Orders and any significant deviation from estimates could create some volatility in the exchange rate.

I remain on hold as I find it difficult to see any direction at the specific levels but without straying from my main thought to buy the European currency after some sharp dip.

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