Right click the mkerchant, it will tell you the income it's earning. If it's in the hundreds, it's trading with other regions.
You can also click the economy screen (pile of coins on the main panel) which lists the income of each province. If you click the province in question in the subsequent list, it should tell you the income from trading, broken down into local trade and trade with each other region.
2 other points that can prevent trade. First is I think you need more than the basic trading post, you need to upgrade it to at least a merchant for overseas trade iirc. (Going from memory here)
Second, you have to have the right sort of trade goods, for example if you have silk as a resource, you can't export it to another silk producing region.