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How to Trade the Euro's Slide

Mike Kemp | Getty Images

As Greece's problems mount, the euro has been breaching new levels, but this strategist says it's no time to be contrarian.

It wasn't all that long ago that the euro was stuck in a tight trading range, confounding investors - but you wouldn't know that today. At under 1.26, the single currency is breaching levels not seen in months.

But if you're thinking about taking the other side of that trade and buying the euro against the dollar, think again, says Andrew Busch, global currency and public policy strategist for BMO Capital.

"There's a time to get fancy in the currency markets. This isn't it," he says. With the news from Greece increasingly grim and slim prospects for meaningful changes from the European Union summit, "Don't get fancy, don't get too smart, don't overthink it - just sell it."

With the euro now on the move, Busch told CNBC's Melissa Leethat it's tough to set specific levels. He suggests using Tuesday's low close to 1.27 as a stop, and entering the trade at whatever current level feels comfortable.

Granted, short euro positions are enormous right now, which suggests that any fragment of good news could trigger a short-covering rally. If you're concerned about that, Busch says you could buy the euro against the British pound, since the Bank of England seems intent on cutting interest rates.

But Busch thinks selling the euro is more promising. "You just want to take what the market's telling you," he says. "Even though the market's really short, everybody's using rallies to sell. Don't overthink it - just get involved and dump it."

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