The EUR rose on Tuesday as investors booked profits a day after the currency hit its lowest level against the dollar since early 2006. Against the Dollar, the EUR rose above $1.20 after tumbling to $1.1876 on Monday, its lowest level since March 2006. But analysts said the market was still anxious about debt levels in several Euro Zone countries and debt auctions this week from Portugal and Spain.
The EUR also hit an all-time trough below 1.38 Swiss francs but rebounded sharply, with traders citing Swiss National Bank (SNB) intervention to weaken the franc. Data showing how much Switzerland has benefited from the European debt crisis pushed the Swiss franc to a new high versus the EUR. Analysts said that may have prompted some intervention by the Swiss National Bank -- either by buying EUR against the franc or the U.S. dollar. The EUR abruptly rebounded from a low against the Swiss franc earlier spurred talk of intervention by the Swiss National Bank. The SNB has intervened since 2009 to prevent excess franc strength but slowed its EUR purchases recently as the EUR fell below 1.40 francs.
The market remains bearish on the EUR generally, with Monday's four-year low of $1.1876 still a downside target, followed by expected options triggers around $1.1850.