By Gertrude Chavez-Dreyfuss NEW YORK, Nov 30 (Reuters) - The euro fell across the board on Tuesday, plunging to 2-1/2-month lows against the U.S. dollar, with losses seen accelerating given nagging worries about euro zone sovereign debt. A financial rescue deal for Ireland failed to contain contagion fears as the euro fell below the critical $1.30 level and investors took out many options barriers on the way. The next key figure to watch, traders said, is $1.2794, the 61.8 percent retracement of the June to November rally. In tandem with euro weakness, the premiums investors demand to hold Spanish and Italian sovereign bonds over German debt jumped to lifetime highs while yields on Portuguese, Irish and Belgian bonds also widened. 'The European credit market is in panic mode because of fears of insolvency (for some euro zone countries) and the euro is trading off those credit yields,' said Boris Schlossberg, director of FX research at GFT in New York. 'For the euro to stabilize, credit yields need to stabilize and for that to happen we need action from the European Central Bank. The Irish bailout was not enough and so the pressure is building.' The ECB meeting this Thursday is therefore crucial as investors will be looking for comments on how the bank could help address growing hysteria in the credit and currency market. It is also widely expected to keep rates on hold and sources say it could extend banks' access to unlimited three-month funds beyond January. For more see . The euro fell to $1.2969 on EBS trading systems, its lowest since Sept. 15, before modestly recovering to $1.2977, down more than 1 percent. Some traders said there is minor support around $1.2920, the Sept. 6 high. That level preceded a steep rally in the euro that took it all the way to that early November high at $1.4283. The euro also stayed well below its 200-day moving average, currently around $1.3127, having closed beneath it on Monday to signal a bearish trend ahead. BEARISH SENTIMENT, RISE IN VOLATILITIES Traders said the ease with which the euro had broken key levels in recent days reflected the extent of negative sentiment towards the currency, which has lost around 9 percent against the dollar since its peak this month. Euro/dollar implied volatilities spiked on Tuesday to a peak of 15.55 percent, the highest since at least June, suggesting nervousness about the euro zone currency. The one-month 25-delta risk reversals, a gauge of currency sentiment, traded as low as -2.85 vols for euro puts versus a close of -2.73 on Monday. Further reflecting the euro's negative bias, the latest positioning data from the Commodity Futures Trading Commission showed speculators going net short on the euro for the first time since Sept. 14. 'With euro positioning nowhere near any extreme there is more scope for downside over the coming sessions,' a London-based trader said. 'Flows retained a negative euro bias with macro funds selling euro cash and positioning to the downside via options.' The euro zone single currency slid to 1.2972 Swiss francs , 108.90 yen, and 83.665 pence against sterling, all more than 10-week lows. With the spotlight on the euro, the dollar continued to gain, hitting a more than two-month high at 81.444 against a currency basket, lifted by safe-haven flows and recent evidence of an improving U.S. economy. (Additional reporting by Jessica Mortimer in London; Editing

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