Europe is struggling—and it could get even worse

If Europe's economy were a painting, it would be a still life. And that may not be good news for the euro.

GDP data showed that the Eurozone's combined economies grew just 0.2 percent in the second quarter. One of the biggest problems for the EU is that its largest economy, Germany, actually contracted by 0.6 percent in the second quarter.

(Read: Bond market bullishness ramps up)

As a result, interest rates in Europe are falling, with the benchmark 10-year German bund yielding just above 1 percent. Even bonds perceived as riskier, such asSpain's 10-year bond, are trading with yields almost on par with the U.S. 10-year note.

Meanwhile, the Eurozone's common currency is trading near nine-month lows. And according to David Seaburg, head of equity sales trading at Cowen and Company, the euro has more downside ahead.

"There's going to be more downside to the euro," Seaburg said. "As goes Germany, so goes Europe," and "the effects of that could be a little bit more long-lasting than people think."

(Read: Dollar edges up from early losses in thin trading)

On the other hand, Ari Wald, head of technical analysis at Oppenheimer, thinks the euro will have a bit of a bounce now that it is close to $1.33 per euro, which was its low in November 2013.

Wald believes sentiment has gotten too pessimistic. A survey from Consensus Inc. in May showed more than 70 percent of market participants were bullish on the euro. "That's fallen all the way to 27 percent," he said. "So there's a lot of bulls on the sideline here waiting to get in."

Sentiment will eventually swing the other way, Wald believes. "This is the time to start getting interested," he added. "It still needs to inflect but as a trading idea, I think you get a little bit of a pop."

To see the full discussion on the euro, with Seaburg on the fundamentals and Wald on the technicals, watch the above video.

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