Morgan Stanley: sell EUR/JPY
EUR/JPY keeps consolidating in the 130.00/132.00 range after having peaked at 133.80 on May 22. On Friday the pair slipped to 130.50.
Morgan Stanley strategists recommend shorting EUR/JPY with a target of 122.00 and a stop at 133.80. In their view, long positions are very vulnerable because of the prolonging euro zone’s recession.
Near-term support lies at 130.20, 130.00 and 129.50 (200-months EMA), while resistance is seen at 131.10, 132.00 and 133.00. The MACD divergence on a daily chart confirms the bearish view.
Chart. Daily EUR/JPY