The defender withdrew from the England squad ahead of the Lionesses’ World Cup qualifiers against North Macedonia and Northern Ireland last week to focus on rehabilitation around an ongoing issue.
There was similar cause for concern with fellow centre-back Alanna Kennedy, with the Australian having broken her nose during an international friendly with New Zealand.
However, Taylor revealed some positive news around both defenders’ recoveries ahead of this weekend’s showdown at the Chigwell Construction Stadium.
“(Alex is) okay, she’s been able to take a few steps back, start to work around the knee and get her strength back up,” Taylor explained in his pre-match press conference.
“She’s performed amazingly and has been a vital player for us, she’s played a lot this season so we need to manage her the best way we can.
“We’re not blessed with lots of options at the moment in that area. but she’s looked good, she’s moving nicely towards the week.
"(Alanna) is back which is great. She’s been assessed by the medics and it’s a typical centre half type of injury, that one!
“She's tough - I’ve not had the opportunity yet to have a conversation with her, it could be she wears some form of temporary mask which gives her the chance to play but at the moment she’s okay.
“The players look like they’ve been in good shape, a couple of knocks but we will be able to have our final session tomorrow before the game.”
The boss has been impressed with Losada’s recovery from a knee complaint sustained in our 4-1 Manchester Derby win, but believes this weekend’s clash may come too soon for her to make her comeback.
And while the City boss called for supporters to remain patient with the winger’s return to the fold, he said she is nearing a starting berth.
He reflected: “Chloe made her introduction in the previous game, she’s had a good level of training, we've been able to work her well during the last ten days, how she deals with the ball under fatigue and she's come through really well.
“Expectation levels need to be held to an adequate level, we can’t expect to see what we saw last season (straight away), an amazing campaign.
“But she’s in good shape and pushing for a start.
“Vicky still has a slight niggle in the medial part of her knee, she’s working tremendously hard, too soon this weekend but next might be closer.”
Victory for City at the weekend would put us within touching distance of a second piece of silverware this season following March’s Continental Cup triumph.
And Taylor has called for his players to use that 3-1 win over Chelsea as a springboard for further cup success.
“Confidence and belief doesn’t last for long but you have to constantly look at revisiting those moments and try to feel how we felt.
“Like in most semi-finals and finals you’ll have moments where you’ll suffer but we came through it the other side with real character and quality.
“Our job as staff is to reinforce that with the players, revisit what we’ve achieved and can do without being too overconfident to give us the best chance.”