The euro continued to rally against the U.S. dollar on Tuesday, erasing some of the losses from last week's sharp decline, but stalled at 1.3966 toward the end of the European trading session.
After hitting 1.3966, a new 2-day high, EUR/USD retreated to hover around 1.3955. The pair was likely to find resistance at 1.4194, last Monday's high, and support around 1.3886, the daily low.
The pair slid from its fresh high after U.S. Treasury Secretary Timothy Geithner warned that long-term budget deficits endanger the national economy and must be curbed as soon the country had pulled out of recession.