* Euro falls vs dollar as Ireland aid fails to calm fears
* Peripheral European debt worries remain
* Technical may pull euro toward a $1.31-$1.3350 range
* Moody's says multi-notch Ireland downgrade likely (Recasts; adds comments, details, updates prices)
By Steven C. Johnson
NEW YORK, Nov 22 (Reuters) - The euro slumped on Monday as worries about how a bailout of Ireland will be implemented doused earlier investor optimism and failed to ease fears about the finances of other indebted euro zone countries.
The euro, which hitt a one-week high near $1.38 overnight directly after the European Union and International Monetary Fund agreed to a rescue, swiftly surrendered gains.
By midday in New York, the currency had dipped below $1.36 as an already unpopular Irish government began to unravel. For details, see [ID:[ID:nLDE6AL00M]]
Investors also feared aid, which an EU source said could total 80 billion to 90 billion euros, may not be enough to backstop Irish banks or stop similar runs on assets in heavily indebted Portugal or Spain. [ID:nLDE68T0MG]
"The question is, 'What's next?'" said Matthew Strauss, an RBC Capital Markets strategist in Toronto. "It's hard to see how Ireland will get the economic growth needed to repay its debts, especially given the political uncertainty it faces. And given Portugal's finances, people wonder, 'Will it be next?'"
Portugal's debt burden is rooted in slow growth and an increasingly uncompetitive economy. [ID:nLDE6AL04W]
The euro was last down 0.8 percent at $1.3580
The Aug. 6 intraday high of $1.3334 is the first significant support level, he said, followed by $1.3211 and the 200-day moving average around $1.3139.
A solid break below those levels will probably be a tougher nut to crack, at least in the remaining weeks of 2010. "We would need new developments about Europe or a strong new reasons to buy the U.S. dollar." Strauss said.
The EU and IMF agreed to a 110 billion bailout for Greece last May, For Ireland's rescue, the UK and Sweden, neither of which is a member of the euro zone, announced plans to participate.
Ireland is putting the finishing touches on a 15-billion-euro austerity plan, and the EU/IMF rescue will shore up a banking sector devastated by a housing collapse without Ireland having to borrow at extremely high rates on capital markets. Still, ratings agency Moody's said Monday a "multi-notch downgrade" on Ireland was now likely. [ID:nLDE6AL0ZA]
EURO LONGS REDUCED
Data from the U.S. Commodity Futures Trading Commission on Friday highlighted uncertainty as speculators more than halved net euro/dollar long positions to 8,606 contracts last week from 23,283 the week before. [ID:nN19210329]
[ID:nLDE68T0MG]
Euro zone debt struggle: http://r.reuters.com/hyb65p
Multimedia on euro zone crisishttp://r.reuters.com/hus75h
A tendency among investors to close their trading books in December and take profits for the year may also lift the dollar in the weeks ahead.
"Investors have been undecided on the euro for a while now and I can see that uncertainty lasting into year-end," said Jane Foley, senior currency strategist at Rabobank in London.
The euro also cut gains against the yen to trade down 0.6
percent at 113.39 yen. The dollar was little changed against
the yen at 83.44 yen
Dealers said trade was thin partly due to a Japanese market holiday on Tuesday and a U.S. market holiday on Thursday. (Additional reporting by Nick Olivari in New York and Jessica Mortimer in London; Editing by Leslie Adler)