How to Trade Euro Jitters

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Europe worries are mounting again, and this strategist has a trading plan.

You just can't go too long in this market without something worrisome cropping up in Europe. Right now investors are worried about the upcoming release of the Spanish budget, and Amelia Bourdeau, director of foreign exchange at Westpac Institutional Bank, wants to play those concerns.

"There had been some risk seeking in the market and euro's been stuck in a pretty tight range," she says. But with Spain about to release its 2012 budget, and investors nervous about whether there will be enough fiscal consolidation, "there is some headline risk with euro, and I do like to short it into the weekend."

Noting that euro-dollar has been trading in a range of 1.3000 to 1.3500, Bourdeau told CNBC's Scott Wapner she wants to sell the single currency against the dollar at 1.3240 with a stop at 1.3310. She is setting two price targets: first is 1.3000, the bottom of the recent trading range, and then if the pair reaches that point, 1.2800.

Brian Kelly of Shelter Harbor Capital thinks selling the euro is a great way to set up for Friday's news. "Range trading the euro is probably the only way to do it right now," he says. "It's been almost untradeable from a longer term perspective."

You can watch the discussion on the video.

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