MUFG Research flags a scope for an extended upside in EUR/USD towards 1.24-1.25 on a sustained break above 1.20.
"The US dollar appeared to derive some support at least temporarily from month end flows which resulted in EUR/USD testing the 1.2000-level yesterday before falling back to a low of 1.1925. As usual we would not place too much emphasis on month end price action, the underlying trend of US dollar weakness remains in place," MUFG notes.
"There is an increased risk that US dollar weakness could accelerate if key support levels are broken in the near-term. Beyond the 1.2000-level for EUR/USD there is little in the way of technical resistance until between the 1.2400 and 1.2500-levels," MUFG adds.