* Euro retreats from four-month high vs dollar * CHF stumbles, lower oil prices trim safe-haven demand * Analysts see room for short-term euro correction (Adds comment, updates throughout) By Naomi Tajitsu LONDON, March 8 (Reuters) - The euro slipped versus the dollar on Tuesday, pausing from a rally spurred by expectations of a euro zone interest rate rise and raising the possibility of a downward correction on concerns about euro zone debt problems. An early slide in oil prices also encouraged investors to pare back long positions in the Swiss franc -- which has gained broadly from safe haven buying throughout the political uprising in Libya. The dollar jumped as much as 1 percent against the Swiss franc CHF= while the euro lost steam after rallying to a four-month high above $1.40 on expectations the European Central Bank may raise interest rates next month. Near-term support is seen at $1.3862, the previous three-month peak hit in early February. "As oil has come off people have squared some of their positions and now we could see the euro continue to edge a bit lower," said Adrian Schmidt, currency strategist at Lloyds. With a euro zone rate rise in April largely priced in and positioning data showing currency speculators have ramped up their long euro positions, some in the market say the euro is ripe for a short-term correction. [IMM/FX] However, traders said buying by sovereign accounts helped to cap the euro's losses, while options expiries due at 1500 GMT, including at $1.3900, $1.3990 and $1.4000, may keep it hemmed within a range until then. The euro EUR= fell 0.4 percent to $1.3905, extending a retreat from a four-month high around $1.4036 hit on Monday. Traders said stop-loss orders were triggered on the break of $1.3940 and $1.3925, with more reported at $1.3885. "We're seeing continued EUR/USD selling from the real money community. It feels like the market wants to target 1.3880-1.3850," a London-based trader said. Following a break of the $1.3862 February peak, the next technical level was $1.3830, the low hit on Thursday before ECB President Jean-Claude Trichet's hawkish comments at a news conference after a policy meeting. Below there, the euro could be heading towards $1.35. Euro zone countries are ironing out measures to resolve the region's debt crisis in time for a European Union summit on March 24-25. They will meet at a preliminary summit on Friday and any sign leaders are struggling to reach a consensus on a debt rescue fund could trigger more profit taking in the euro. "We have constructive expectations for reform of the EU financial stability fund. If those aren't realised, we could see negativity on the euro in the short term," said Carl Hammer, currency strategist at SEB in Stockholm.

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