MUFG Research discusses flags a lack of clear trend in FX markets in the near-term.
"The US dollar has continued to weaken at the start of this week after failing to extend its advance at the end of last week. The dollar index failed to break above technical resistance from the 55-day moving average at just below 98.30 and is now pulling back toward support from the 200-day moving average at just below 97.60," MUFG notes.
"EUR/USD staged a sharp rebound late on Friday after failing to break below the 1.1000-level. It leaves the FX market stuck in limbo in the near-term and lacking clear trends. It favours a continuation of current favourable conditions for carry trades with FX volatility at historically low levels right now," MUFG adds.