How to Trade the Progress In Europe
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Euro zone finance ministers have actually made concrete progress toward solving their problems, agreeing on a framework for common bank supervision. They are also on track to provide another tranche of aid for Greece.
Withe the progress in Europe coming just one day after the Federal Reserve stepped up its stimulus efforts, currency investors have been left wondering why the obvious trade hasn't worked yet. The euro did rise on news of the agreement, but only briefly.
Todd Gordon, co-head of research and trading at Aspen Trading Group thinks he has the answer.
"Fundamentally speaking, I think the euro is supported," he told CNBC's' Simon Hobbs, nodding to the steps taken to get Greece and euro zone banks back on track. The currency should also be helped by the Fed's push to boost U.S. economic growth, he says - and in fact, the dollar did weaken right after that plan was announced.
So while the euro may be stuck below 1.3100 to the dollar at the moment, Gordon does not expect that to last. "It looks to me that that 1.3100 level really wants to go, so we need to be long here," he says.
Gordon wants to buy the euro against the dollar for a quick trade, entering at 1.3075 with a stop at 1.2975 and a target of 1.3200.
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