Morgan Stanley: how to trade USD/JPY?
US dollar extends the upside versus the Japanese yen on Thursday, testing the levels above 107.00 yen per dollar. However, the narket is clearly overbought and needs to retrace lower. That's why currency strategists at Morgan Stanley recommend buying USD/JPY on dips to 105.00 and targeting 108.00 yen.
"The increasing debate regarding Japanese monetary policy, with the calls for the next stage of the sales tax to be delayed, will likely support the current USD/JPY move higher, with the Nikkei also currently outperforming", they say.
BUY LIMIT at 105.00
TAKE PROFIT 108.00
STOP LOSS 104.00
Chart. Daily USD/JPY