* Euro reverses gains, falls below $1.50
* China should increase euro, yen holdings - report
* Wall Street slips on speculation of end of tax credit (Updates prices, adds comment, changes byline)
By Wanfeng Zhou
NEW YORK, Oct 26 (Reuters) - The U.S. dollar rose from a 14-month low against the euro on Monday as falling stock and commodity prices dampened risk appetite, prompting investors to lock in recent gains in other currencies.
Investors were also reluctant to push the euro higher given the huge amount of bearish trades on the dollar, which suggests a near-term recovery in the U.S. currency is on the horizon.
U.S. stocks fell with financial shares tumbling on speculation that a federal tax credit for home buyers would expire, while oil prices also traded lower.
"You do have an overall reversal in risk appetite," said Samarjit Shankar, managing director of global FX strategy at BNY Mellon in Boston.
"It's primarily a lot of profit-taking on long risk positions and some hesitation on the part of market participants ahead of the (U.S. gross domestic product) number that's going to come out this week," he added.
The euro fell to session lows at $1.4857
The ICE Futures dollar index <.DXY>, a gauge of the greenback's performance against six other major currencies, was up 0.71 percent at 76.003.
U.S. lawmakers are working on a proposal to phase out the tax credit for first-time homebuyers over 13 months, according to a note from research group ISI Group Inc. [ID:nN26194506].
It was a turnaround for the dollar, which struggled earlier, partly due to a report saying China should increase its holdings of euros and yen in its foreign reserves. [ID:nPEK285229]
Against the yen, the dollar was flat at 92.04
(Additional reporting by Gertrude Chavez-Dreyfuss; Editing by Andrew Hay)