Euro May Be in ‘Next Leg Down,’ Citi Says: Technical Analysis

The euro may tumble as much as 6 percent versus the dollar if the currencies mimic a series of moves in November as concern builds that Europe’s sovereign-debt crisis is worsening, according to Citigroup Inc.

Europe’s shared currency fell from $1.4283 on Nov. 4 to $1.3446 on Nov. 16, rallied over the next four trading days to touch $1.3786, and then dropped again in an “aggressive move lower,” Citigroup analysts Tom Fitzpatrick, Shyam Devani and Alex Good wrote today in a report. It weakened today after rising for four days following an eight-day slide from $1.4940 on May 4, they wrote. The European currency may drop to about $1.35 if the previous move is replicated, they wrote.