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Your Currency Play on Central Bank Intervention

Ian Mckinnell | Photographer's Choice RF | Getty Images

Tired of trading the euro? This strategist has a play on two central banks' different market intervention efforts.

Like just about everyone in currencies these days, George Davis, chief technical analyst at RBC Capital Markets, is watching the euro. He thinks it's going to continue to trade in a fairly tight range, so he is looking elsewhere for some action.

"One of the interesting undercurrents that we've seen in FX markets, aside from the issues in Europe, has to do with differing intervention objectives between the Swiss National Bank and the Bank of Japan," Davis told CNBC's Scott Wapner.

The Swiss, Davis says, have "overtly told the market that they want to reverse Swiss gains against the euro," due to worries about potential deflation, and they have set specific targets for the Swiss franc against the euro. The Japanese have also intervened to stem their currency's rise, but despite major efforts they have failed to keep the yen in check.

Given the Swiss National Bank's determination, and their use of specific targets, Davis wants to sell the Swiss franc against the yen at 87.25 with a stop at 89.30 and a target of 83.00.

You can watch the discussion in the videotape, above.

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