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Greek Debt-Deal Success Points to a Risk-On Trade

Friday, 9 Mar 2012 | 4:03 PM ET

The Greek debt deal is injecting optimism into the currency market. Here's how to trade the good mood.

How'd you like that Greek debt deal? The market sure did. And Camilla Sutton, chief currency strategist for Scotia Capital, thinks the good mood is creating a trading opportunity.

"When we look at Aussie-yen, we've had two big themes in place this year: a little bit better growth, and very very low volatility," she told CNBC's Scott Wapner.

Greek Deal Optimism to Sustain Rally?
The dollar is surging against most major currencies on signals that the U.S. economy is improving. Camilla Sutton, chief currency strategist at ScotiaBank, weighs in on that as well as optimism surrounding the Greek debt deal.

What with the central bank fueling low volatility by adding liquidity, "it still makes carry a reasonable trade," she says.

So Sutton wants to buy the Australian dollar against the yen, entering right around current levels at 87.50 with a stop at 86.50 and a target of 89.50.

"Until we get those volatility measures ticking higher, I think we can still be long Aussie short yen. In this environment, it's still the one trade that is still working for most people out there," she says.

You can watch the discussion on the video.

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