Add yeast to warm water and let stand for 10 minutes.
Mix together milk, sugar, salt, orange juice, butter, orange peel and raisins (if desired). Beat until smooth (you may use a mixer). Add yeast mixture and egg, stir well. Add the flour to make a soft dough. Turn onto a floured board and knead until smooth and satiny, 10 minutes by hand or 4 minutes in an electric mixer or food processor fitted with a dough hook. Put dough in oiled bowl, turning once to coat thoroughly. Cover with a damp cloth and allow to rise in a warm, draft-free place until doubled, about 1 hour.
Knead down. Turn dough onto a lightly floured surface. Divide into 6 equal portions and let rest for 10 minutes. In a medium-sized mixing bowl, combine sugar and cinnamon, mix well.
Roll each portion into a rectangle, 1/2 inch thick. Divide sugar and cinnamon equally among rectangles of dough. Sprinkle each rectangle with a few drops of water and smooth with a spatula. Roll into 6 long ropes, sealing the edges. Braid 3 ropes together for each loaf, and put in two 9x5 prepared pans. Cover, with a damp cloth and allow to rise in a warm, draft-free place until doubled, about 1 hour.
Preheat oven to 350°F. Bake for 30 minutes, until tops are golden brown. Remove from pans and cool on rack. Blend confectioners sugar and orange juice for glaze, and drizzle over warm loaves.