Citigroup (NYSE:C) Says Euro Could Drop to 2005 Levels

Citigroup (NYSE:C) say the euro could drop to levels not seen since the latter part of 2005, with estimates it could fall to $1.164 over the next 30 to 90 days.

Noting the currency fell to the middle of its all-time high and all-time low, dropping to $1.2134 today, head technical strategist at Citigroup, Tom Fitzpatrick, said if it can’t break up that mark, it could has some negative ramifications going forward.

“As we stand today, we made that break, we’ve been unable to get above it,” said Fitzpatrick. It really does open up the danger that we could start a leg lower.”

The prior low was $82.80 cents, while the all-time high is $1.6038. The low today is its weakest since April 14, 2006.

Fitzpatrick said if the euro is able to close over the $1.2329 at the close of the markets this week, it could rebound.

That seems to be a major challenge to overcome as Chinese manufacturing has fallen while news banks in the EU could lose up to $237 billion over the next 18 months doesn’t offer a lot of support for the euro.

According to Fitzpatrick, if the euro were to strengthen during the week, it could show the market may have been overreacting to the sovereign debt crisis in Europe.

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