How to Trade a Hot Dollar
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The U.S. dollar has had a great week, and this strategist thinks there is more to come.
The dollar has had one of its best weeks in a long time, and the good times could keep rolling.
Willie Williams, director of institutional derivative sales at Societe Generale, thinks the greenback is benefiting both from improving U.S. economic reports and from troubles in Europe. Noting that Spanish bond yields are rising sharply, he told CNBC's Scott Wapner that "the market is starting to become concerned that the European problem is creeping back on the table."
Still, Williams would rather buy the dollar against the Swiss franc. The Swiss National Bank apparently waded into the market to keep the franc from strengthening beyond its target level against the euro earlier today, and Williams argues that "there's a good chance that the SNB remains supportive of the 1.20 level." He expects the dollar to strengthen against both the euro and the Swiss franc, but he says, "I just think the Swiss franc is in a better technical position."
Williams wants to enter the trade at 0.9200 with a stop at 0.9075 and a target of 0.9600.
You can watch the discussion on the video.
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