Despite the ongoing turmoil in Europe, the euro has fared well in June - but this strategist says the party is just about over.
A Greek election, glum economic indicators, bank aid requests and crippling bond yields in Spain - through it all, the euro has had a pretty good month. But Marc Chandler, chief currency strategist at Brown Brothers Harriman, says the good times are about to stop rolling.
In early July, both the European Central Bank and the Bank of England are likely to ease monetary policy, Chandler told CNBC's Scott Wapner, but the Federal Reserve is only continuing Operation Twist.
"I'm thinking that the rally in the euro is over, and the downtrend is about to resume and I'd look for the euro to fall back and make new lows for the year below that 1.22 level," he says.
The news coming out of Europe seems to be only bad," Chandler says. Even the European Central Bank's decision to loosen its rules for loan collateral "is in effect the ECB diluting its balance sheet," he say, and "can not be seen as positive for the euro."
Since headlines are coming fast and furious from Europe, Chandler wants to wait for the euro to move a little higher on some bit of news, and then sell at 1.2600. He recommends setting a stop of 1.2700 and a target of 1.2288.
Longer term, Chandler thinks the euro could move below 1.2000 before the end of the third quarter before the dollar has its own weakening around the election.
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