* Euro supported as market awaits U.S. jobs data
* Better-than-forecast number could see euro rally
* Long dollar/short yen trades good bet into jobs data
By Nia Williams
LONDON, Oct 5 The euro hovered near a two-week
high against the dollar on Friday after the European Central
Bank assured investors it was ready to buy bonds to tackle the
debt crisis, with further gains dependent on U.S. jobs data
later in the day.
A better-than-expected U.S. non-farm payrolls number,
released at 1230 GMT, could soothe concerns about the health of
the world's largest economy and fan demand for perceived riskier
currencies against the safe haven dollar.
A Reuters consensus forecast showed market players were
expecting 113,000 jobs to be added.
"Today if we see a good U.S. number, say above 160,000, that
would be bullish for risk and bearish for the dollar," said
Daragh Maher, currency strategist at HSBC.
The euro was steady at $1.3015, holding within sight
of Thursday's two-week peak of $1.3032. Strategists said the
euro could rise further but there was resistance around $1.3172,
the September high.
ECB President Mario Draghi said on Thursday that everything
was in place for the central bank to buy the bonds of struggling
euro zone countries like Spain and that conditions linked to it
need not be punitive.
But Draghi, speaking after the ECB left interest rates
unchanged at a record low 0.75 percent, offered no clues as to
when Spain might make a formal aid request that would activate
Market players said traders were wary of selling the euro
before any Spanish aid request. If Spain asks for a bailout it
would be likely to lift investor appetite to take on risk and
boost the euro.
Speculators have been cutting short bets against the euro in
the past few weeks with Asian central banks also buying the
single currency at lower levels. That has ensured solid support
around its 200-day moving average of around $1.2824.
The euro has also been supported by investors buying it back
against currencies such as sterling and the
Australian dollar, traders said.
The euro slipped 0.1 percent against the Australian dollar
to A$1.2695 but remained close to a four-month high of A$1.2718
hit on Thursday.
BOJ STAYS ON HOLD
Some strategists said the best trade to benefit from the
U.S. jobs report would be to buy the dollar and sell the
"Long dollar/short yen would be safest best. If it is a good
number, we will see the dollar rally against the yen. And if it
is not a good number we would still see the dollar being
supported," said Geoff Kendrick, currency analyst at Nomura.
Investors are wary of buying the yen on concerns that the
Japanese authorities could intervene to weaken it. Japanese
officials have expressed concerns about the strength of the yen
in recent weeks.
The yen briefly nudged higher after the Bank of Japan kept
monetary policy unchanged and held off from additional easing
measures. The reaction was limited, however, as Friday's
decision was in line with expectations.
The dollar dipped to an intraday low of 78.28 yen
following the BoJ's announcement, but later pared losses to
trade at 78.46 yen, flat on the day.
Traders said the dollar would probably find support from
buyers at 78.00 yen, while the resistance came in at the 100-day
moving average around 78.83 yen.
The euro dipped 0.1 percent against the yen to 102.05
, not far from a two-week high of 102.27 hit earlier in
(Additional reporting by Anirban Nag/editing by Chris Pizzey,
London MPG Desk, +44 (0)207 542-4441)