By Cecile Lefort and Naomi Tajitsu

WELLINGTON/SYDNEY, Jan 25 (Reuters) - The Australian and New Zealand dollars were nursing losses against the euro and U.S. dollar on Friday as investors trimmed long positions, but regained enough ground on the yen to put them on track for a 5 percent gain in January.

The euro shot up to a one-month peak of A$1.2808, having surged 1.3 percent overnight. It was dragged higher by a jump in the euro/yen on better European data which sparked a wave of short-covering.

Joseph Capurso, a strategist at Commonwealth Bank of Australia expected euro strength to continue well into next week, having already gained more than four cents in two weeks.

'There is a lot happening next week in America and if there is any downside surprises, you could see the euro rise even more,' he said.

On Jan 29-30, the U.S. Federal Reserve's Federal Open Market Committee (FOMC) holds its two-day meeting on interest rates, ahead of the non-farm pay roll report on Friday.

It is, however, facing formidable resistance at the Dec 27 trend high at A$1.2805 with the Oct 8 trend peak not far behind at A$1.2825. It last fetched A$1.2781 and was on track to show a 1 percent gain for the week.

Likewise, the euro rose to NZ$1.5981 against the kiwi , after leaping nearly 1 percent on Thursday. It was still a fair way off a December peak of NZ$1.6219.

The strong euro weighed on the Antipodean currencies against their U.S. counterpart with the Aussie slipping to a three-week low of $1.0438.

It skidded nearly 1 percent Thursday, its biggest one-day drop in four months and looked set to end the week 0.7 percent. It was, however, still up for the month and last bought $1.0440.

The Aussie had already been nursing losses after failing to head higher on the back of stronger Chinese manufacturing data. Speculators took it as sign to cut overlong positions.

Initial support was seen around $1.0442, the 61.8 retracement of the $1.0345/$1.0599 move, ahead of the 100-day MA at $1.0418. Resistance was found at $1.0500.

The New Zealand dollar had a heavy tone at $0.8356, having struck a two-week high of $0.8447 on Thursday. It looked set to end the week flat.

The Aussie and kiwi dollars held hefty gains versus a broadly-weaker yen with the Aussie steady at 94.52 yen , on track to post nearly 5 percent in gain this month. It scaled last week its highest since 2008 at 95.02.

The kiwi dollar fared even better and looked poised to show a 5.3 percent increase in January. It last fetched 75.64 yen within sight of last week's four-year peak of 75.80.

Both currencies have risen more than 14 percent on the yen since November with analysts expecting the rise to continue given the Japanese government's determination to fight deflation and lower the currency.

Australian bond futures retreated from one-month highs with the three-year bond contract off 0.04 points to 97.290, while the 10-year contract also eased 0.04 points to 96.710.

New Zealand government bonds were largely flat.

Keywords: MARKETS AUSTRALIA NEWZEALAND/FOREX

(Australia/New Zealand bureaux)(+61 2 9373 1800/+64 4 802 7980)

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