TD Research likes to fade USD weakness is in the option space with a short EURUSD 1.19/1.21 call spread (expiring in 1-month on 12/16/2020).
"Slowing mobility trends is a negative for global growth dynamics. This is an environment that should augur for a more defensive posture short-term in EURUSD. The ECB has also adopted a far more dovish tone at its last meeting, and the decision next month is likely to bring new easing measures," TD notes.
"While we think it is far too early to declare a shift in FX reaction functions to central bank dynamics, we just have a hard time thinking that EURUSD is ready to achieve escape velocity in less than favorable conditions at this time with lockdowns rising," TD adds.