Despite all the euro news, the currency is basically range-bound, this expert says. Here's how to trade it.
Between the upheaval in Greece, the worries about sovereign debt problems spreading, and investors' on again-off again thing for currency risk, you would think the euro would be dancing. But if you look at the charts, surprisingly little is happening, says Todd Gordon, co-head of research and trading at Aspen Trading Group.
"The chart is range bound, despite all you're seeing in the news," Gordon told CNBC's Melissa Lee. "The trade is to focus on the consolidation in the euro."
Those kinds of moves can be hard to navigate, but Gordon looks at chart patterns for clues. Examining the recent fluctuations, he sees an Elliott triangle pattern. That means Gordon anticipates some kind of breakout in the euro, whether from Fed Chairman Ben Bernanke's press conference or something else. But if the patterns hold, Gordon then expects to euro to drop near $1.42 before pushing substantially higher, perhaps to $1.49.
"This is a fourth wave breakout. A fifth wave push down to the $1.42 level will complete the pattern. That's our entry," he says. Specifically, Gordon recommends buying the euro at $1.42 with a stop at $1.4070 and a target of $1.49.
You can watch the whole discussion in the video clip.
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