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This Down Under Currency Is Looking Up

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Mike Kemp | Getty Images

Headlines on the debt crisisare coming fast and furious - and this strategist says it's time to stay away from the euro.

Sure, German Chancellor Angela Merkel and French President Nicolas Sarkozy are working hard on the euro crisis, and the news flashes are coming fast and furious. But that's not enough for Todd Gordon, co-head of research and trading at Aspen Trading Group.

Gordon compared yields on Italian bonds to the euro-dollar level. Even though the Italian bond yields are coming down, "the euro has gone nowhere," he told CNBC's Melissa Lee. "The euro is still saying there are problems heading into the Thursday-Friday summit, so euro, I think, is still weak."

The Australian dollar is looking considerably better, Gordon says. It's continuing to strengthen even though manufacturing data for China, Australia's key trading partner, is worsening. Australia is also one of the few big countries holding onto a triple-A rating, and Gordon thinks the central bank is near the end of a round of interest rate cuts.

Gordon recommends selling the euro against the Aussie at 1.3200 with a stop at 1.3400 and a target of 1.2800.

You can watch the whole discussion on the videotape.

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