Morgan Stanley notes a divergence between EUR/USD and core European yields. "The current EURUSD rebound is developing despite core yields still heading lower. This is the most significant divergence seen during the EURUSD downtrend over the past year," MS clarifies. "Again, we believe this implies that the EUR rebound is likely to prove temporary and will eventually provide a renewed medium-term selling opportunity," MS argues. Moreover, MS FX Positioning Tracker suggests that there has been a significant unwinding of short EUR/USD positions recently. "Compared to this positioning adjustment, the rebound in EURUSD has ... (full story)