Our friends at Morgan Stanley are hankering for another long but have they missed the boat?

Perma-USD bulls Morgan Stanley want back into USDJPY longs. They recently got stopped out of a long from 109.50 and are eager to get in again.

Limit Order (Entry: 27-Apr-17)

Entry: 111.00; Target: 120.00; Stop: 109.00

"We renew our call for higher USDJPY. The JPY is likely to weaken as the global inflationary theme comes back onto the agenda, which our economists expect in the second half of this year. The BoJ reaffirmed their commitment to an accommodative monetary policy in today's meeting. Their yield curve control strategy limits the upside in the JPY. (see more details here) In summary, Japan's life insurance community currently holds foreign assets with a high FX hedge ratio. As the Fed hikes rates, the cost to hedge may increase, meaning hedges may not be rolled over. The recent decline of hedging costs represents a one-time adjustment. We expect the USD-JPY rate and yield differential to rise from here. The major risk for the JPY is a market-unfriendly outcome in the second round of the French election, which pushes down EURJPY."

Unfortunately they've been stopped on their early April AUDCAD short at 1.03. They were short from 1.01. In my last post from MS, there was a discussion with reader 5Magics about how their stop was bang on a strong resistance in the 1.0300/50 area. The suggestion was to add to shorts at 1.0300 or against 1.0350 with a stop just above.

AUDCAD daily chart.

It's all redundant now anyway but the resistance around 1.0300 is looking fairly solid still.

Morgan's still like an aussie short and remain short against the US dollar.

Hold (Entry: 26-Jan-17)
Entry: 0.7540; Target: 0.6900; Stop: 0.7760

"The AUD stays on our top selling list as tighter financial conditions in China are expected to spillover to Australia. Australia's latest CPI print undershot market expectations and the consumer is showing signs of weakness too. We find that the AUD has even been falling in an environment of general global market risk on. Iron ore prices remain low and this should feed through to terms of trade. The market is still long the AUD and now getting long AUDNZD at a time when the RBA is concerned about the labour market indicators getting worse and the housing market becoming overextended. The risk to our trade is the market starting to sell the USD on a broad basis."

Here's there brief for some pairs.