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Morgan Stanley's trade of the week............>

FOREX
FOREX: Morgan Stanley's trade of the week recommends buying AUD and CAD against
the USD. They cite optimism around US-China trade talks, the PBoC cutting RRR
and better-than-expected China services PMI. Risks to this trade include a
renewed escalation in trade tensions and fall in commodity prices. MS recommend
buying an AUD, CAD basket at market (100.00) with a target of 105.00 and stop of
98.50.
-In emerging markets, MS recommend short USD/ZAR, citing the currency being well
placed to rally on the outlook for commodity currencies thanks to China's
ongoing stimulus and likely further improvement in risk sentiment towards EM.
Continued support for the ANC ahead of elections should be positive for ZAR.
-MS maintain their short USD/BRL, USD/IDR and short USD/INR trades. Risks to
this trade include a renewed escalation in trade tensions and fall in commodity
prices as well as any further negative headlines around Eskom.
-MS recommend selling USD/ZAR at market with a target of 13.0 and stop of 14.5.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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