The dollar is teetering just below a critical level versus the euro that could send it nearly 40 percent lower, Phil Roberts, technical analyst at Barclays Capital, told CNBC.
Over the last few months the dollar has made a dramatic surge against the European currency as investors welcomed aggressive interest-rate cuts from the Federal Reserve. The European Central Bank kept rates relatively high as the economic slowdown started to severely drag on the economy.
The trigger point is $1.335 against the euro .
"Once you start breaking there then it looks like this has bottomed for the time being and you're going to get a relief rally," Roberts said. "Then you look for probably 38.2 percent retracement, the entire decline, which would take euro / dollar back up to $1.38."
Watch the full interview with Phil Roberts above.
Meanwhile, the Asian currencies are signaling a similar turnaround for the dollar, according to Roberts.
"Dollar/won was one of the first currencies to reflect the credit crunch bite … if it was the first to blow then, is it now showing signs that it's the first to slow, quite probably," he said.
The dollar against rupee and dollar versus Singapore dollar and also showing classic trend-ending patterns, he added.
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