Morgan Stanley strategists are recommending shorting EUR/CHF, betting that heightened risk aversion and rising asset risk premiums in the Eurozone will drag the euro down. The strategist wrote in Wednesday's report that shorting EUR/CHF can hedge against “a further rise in fiscal and political risk premiums,” and that fluctuations in the bond market may cause the market to reprice ECB policy expectations in a more dovish direction. They wrote that the SNB's concerns about the strengthening of the Swiss franc posed a risk of shorting EUR/CHF and could push the pair higher. The strategist suggests shorting EUR/CHF with a target of 0.90 and a stop-loss level of 0.96. They continue to suggest shorting EUR/AUD and expect EUR/AUD to weaken against most currencies.

Morgan Stanley strategists are recommending shorting EUR/CHF, betting that heightened risk aversion and rising asset risk premiums in the Eurozone will drag the euro down. The strategist wrote in Wednesday's report that shorting EUR/CHF can hedge against “a further rise in fiscal and political risk premiums,” and that fluctuations in the bond market may cause the market to reprice ECB policy expectations in a more dovish direction. They wrote that the SNB's concerns about the strengthening of the Swiss franc posed a risk of shorting EUR/CHF and could push the pair higher. The strategist suggests shorting EUR/CHF with a target of 0.90 and a stop-loss level of 0.96. They continue to suggest shorting EUR/AUD and expect EUR/AUD to weaken against most currencies.