The euro may have had a rough week, but this strategist sees a way it could reverse course - sharply.
The euro bears were out in force over the last several days, but Willie Williams, director in institutional sales at Societe Generale, thinks there's a chance the euro could actually hit 1.50 against the dollar by March 2012 - if all the stars align correctly.
"It's not the base case, but it's possible," Williams told CNBC's Melissa Lee. While he still believes that the most likely scenario is one of credit contraction in Europe and greater aggressiveness by central banks, "The situation has deteriorated so fast that the European Central Bank is now saying their mandate is to sustain prices in both inflationary and deflationary scenarios," he says. "That makes us think they might be closer to monetizing the debt than we possibly can imagine."
Adding in bond purchases by the Securities Market Programme, Williams says, "in a market already short the euro, we could see a sharp rally coming into the new year."
It's a bold prediction - a little too bold for some.
Rebecca Patterson, chief markets strategist for J.P. Morgan Asset Management, Institutional, says a rise to 1.50 "is not just short covering. One fifty is a new trend which would imply a huge recovery, a sustained recovery in global risk appetite, major capital flows into the euro area, and probably some independent dollar weakness." The dollar part is plausible, she says, but such a major shift in risk appetite is a stretch.
Andrew Busch, global currency and public policy strategist for BMO Capital, says he thinks "the best case for the euro is to go sideways at best, maybe 1.28 to 1.35 over the first quarter."