FXStreet (Edinburgh) - The single currency is keeping the buoyant tone alive at the beginning of the week, trading in the mid-1.0800s ahead of PMIs and Draghi’s speech later in the session. “The extremely low level of interest rates maintained by the ECB has ensured that the EUR is used as a funding currency for carry trades… While interest rate differentials can drive EUR/USD lower, we expect the downside potential to be moderated by a reluctance to short the EUR/USD. We are forecasting a low at EUR/USD1.04 this year”, suggested Jane Foley, Senior FX Strategist at Rabobank. Furthermore, Axel Rudoph, Senior Technical Analyst at Commerbank, noted “Last week’s EUR/USD failure at 1.0968 is bearish, targeting the 1.0776/11 January lows. This failure occurred slightly below tough resistance at 1.1000/1.1060. These are the recent highs and the 200 day ma, the 2014-2016 downtrend and 55 week ma and we view the market as bearish while capped here. Our target remains the 1.0523 recent low”. For more information, read our latest forex news.