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The Currency Trend Forming Away From Europe

Tuesday, 24 Apr 2012 | 4:18 PM ET
Will Crocker|The Image Bank|Getty Images

The political turmoil in Europe is only intensifying, but this strategist is looking elsewhere for a paradigm shift.

With all that's going on politically in Europe, surely there's a trade to put on, right?

Maybe not, says MacNeil Curry, head of foreign exchange and interest rate technical strategy at Bank of America Merrill Lynch .

"I think what's really interesting here is the euro has been remarkably resilient over the last two months or so," he says. "It does look like it's going to break to the downside, but we're not getting the break down to the catalyst point around 1.30."

Money in Motion: European Bank Stocks
Breaking down the best currency play since European bank stocks hit 2011 lows, with MacNeil Curry, Bank of America Merrill Lynch.

As a result, Curry told CNBC's Scott Wapner, "it's probably best to focus your attention elsewhere until we see a bit of traction."

So Curry is looking at the yen, and he thinks a shift is coming: "I think dollar yen is about to resume its uptrend" that began in March, he says. At that point, "we saw price action effectively switch from a multiyear downtrend to a multiyear uptrend with the breaking of several long-term trend following indicators."

Curry wants to buy the dollar against the yen at 81.00, setting a stop at 80.15 and looking for a move to about 85.00. "We ultimately should see new cycle highs forthcoming over the course of the next couple of months or so," he says.

You can watch the discussion on the video.

Tune In: CNBC's "Money in Motion Currency Trading" airs on Fridays at 5:30pm and repeats on Saturdays at 7pm.

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