FOREX-Dlr trims losses as Asian shares fall, yen crosses slip

* Dollar rebound seen limited on prospect for low rate policy

* Upside for euro/dollar heavy above $1.5000

* Dollar/yen above 6-week low, but downward risks seen

* Dollar short-positions being closed in holiday week

By Kaori Kaneko

TOKYO, Nov 24 (Reuters) - The dollar trimmed losses on Tuesday as Asian stocks failed to follow up a stronger day on Wall Street, prompting some to buy the dollar back, and as some investors closed dollar short-positions before the Thanksgiving holiday.

Tokyo markets were playing catch-up after a three-day weekend and the yen crosses slipped as Japanese exporters sold the euro against the yen and hedge funds took profits on gains in the likes of the Australian and New Zealand dollars made on Monday, dealers said.

The euro found some support from European Central Bank President Jean-Claude Trichet, who said on Monday that as the economic situation becomes more normal, the focus in the medium term calls for a "gradual and timely" phasing out of quantitative measures. [ID:nGEE5AM1L9]

Still, trade was expected to be thin and price moves were likely to be exaggerated ahead of the U.S. Thanksgiving holiday on Thursday, dealers said.

"With a holiday shortened-week this week, there are still investors who want to close their dollar-short positions," said Yuji Saito, head of the FX sales department at Societe Generale.

The dollar index, a gauge of its performance against six major currencies, rose 0.2 percent at 75.235 .DXY, above a 15-month low of 74.679 touched last week.

The dollar fell on Monday after comments from a senior Federal Reserve official reinforced the widely-held view that the United States will stick to its low interest rate policy for a while. [ID:nN22246631]

A rally in U.S. stocks, gold and oil also dented appetite for the dollar.

But Asian shares were in the red on Tuesday, with the Nikkei average .N225 down 0.8 percent as a slightly stronger yen hurt shares in exporters. S&P futures SPc1 were also slightly down. [.T]

"There is a caution over the sustainability of the gain in U.S. stocks, but an abundance of dollars will likely continue to flow into assets such as shares and commodity markets," said Satoshi Okagawa, head of FX forward trading group at Sumitomo Mitsui Banking.

The euro eased 0.1 percent to $1.4940EUR= from late U.S. trade on Monday when it rose as high as $1.5000 on trading platform EBS on Monday.

"The euro could rise further given comments from ECB President Trichet, but the upside for the euro is likely to be heavy and it will struggle to rise well above $1.5000," Saito at Societe Generale said.

The euro had support at $1.4930 and then at $1.4900, said Sue Trinh, senior currency strategist at RBC Capital Markets in Sydney.

The dollar edged down 0.1 percent to 88.88 yen JPY=, having touched a six-week low of 88.57 yen on EBS the previous day.

The Australian dollar slipped 0.4 percent to $0.9204 AUD=D4, off a 15-month high of $0.9407 struck last week.

The New Zealand dollar fell 0.6 percent to $0.7279, having risen over 1 percent on Monday.

Among the yen crosses, the euro dipped 0.3 percent to 132.80 yen EURJPY=R. The Aussie fell 0.5 percent to 81.75 yen AUDJPY=R and the kiwi dropped 0.9 percent to 64.62 yen NZDJPY=R, after both rose more than 1 percent on Monday.

MARKET AWAITS U.S. DATA, FED MINUTES

Traders are also focused on a slew of U.S. economic data later on Tuesday including revised U.S. gross domestic product for the third quarter and housing market data. ECONUS

The Federal Reserve will release minutes of its Nov. 3-4 meeting at 1900 GMT.

"Nobody believes that the U.S. economy is back on a sustainable recovery on its own even though U.S. data show some improvement as they can be explained by the government stimulus measures," said Hiroshi Maeba, deputy managing director of foreign exchange trading at Nomura Securities.

"Unless the data provides surprises, the currency market is expected to stay in ranges," he said.

The U.S. Treasury will offer $42 billion in five-year notes on Tuesday after decent results for a $44 billion auction of two-year notes on Monday. [US/] (Reporting by Kaori Kaneko; Editing by Edwina Gibbs) ((kaori.kaneko@thomsonreuters.com; Reuters Messaging: kaori.kaneko.reuters.com@reuters.net; +81-3-6441-1983)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))