The US dollar was slightly firmer in a generally subdued session here, with investors awaiting June US Treasury International Capital System (TICS) data due out tonight for a fresh lead, dealers said. They noted that some short sellers in the greenback were forced to cover their positions after the US unit held above some key support marks last Friday and this underpinned the dollar's modest upside today. The dollar's downside Friday was relatively light considering oil prices reached fresh record highs and June trade data showed a widening of the deficit, dealers said. Analysts believe the dollar's ability to stay above key support levels against the yen and euro seems to have been read by players as a sign it may have overdone its retreat from last week and could be poised for a rebound this week. "Short covering of the US dollar also appeared to have played a role in supporting the greenback against the majors after the pairs failed to pierce key levels," strategists at Singapore's United Overseas Bank wrote in a daily note. The euro-dollar closed at 1.2440 usd last Friday and its failure to clear 1.2486 usd highs seemed to have been the trigger for the dollar's modest recovery today, dealers said. "If the euro is able to recover above 1.2500 usd in the next few days, we suspect US dollar downside momentum could accelerate rapidly as macro traders scramble to position for the unanticipated break and momentum traders react to US dollar sell signals as well," UBS said in a client note. "As such, we have a pending recommendation to buy the euro at 1.2520 usd. But until that break happens we caution that the euro has to clear offers toward 1.2500, UBS added." The dollar-yen found support from bids under 109.30/35 yen this morning and moved quickly higher in early trade to 109.65 just before the Tokyo fix. US funds and Japanese importers pushed the pair higher but momentum faded and it subsequently topped out at 109.75 before easing back slightly to 109.55/60 yen amid talk of exporter interest between 109.80 and 110.00. The key US release tonight is the June TICS Portfolio flows data which showS foreign demand for long-term US dollar instruments. While the data need not necessarily have any direct impact on the dollar market, they will be watched for signs of whether foreign fund inflows remain strong enough to cover the US deficit and probably set the tone for the dollar for the rest of the week. The median estimate in a survey of economists is for foreign demand for U.S. long-term instruments to be higher at 62 bln usd in June, compared with 60 bln in May. "In all likelihood, the external accounts imbalance problem will continue to be the albatross around the dollar's neck, weighing it down vis-a-vis the key majors," Bank of Tokyo-Mitsubishi's Singapore-based economist Wong Keng Siong wrote in a note. "The positive news for the greenback, though, is the economic growth story, which suggests that the US Fed is likely to continue on its current course on monetary policy for another couple of quarters," Wong added.