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FOREX-Euro near 4-year high against yen, awaits German Ifo

* German Ifo expected to show slightly improved reading

* Seen giving support to euro

* Dollar off four-and-a-half-month highs vs yen

By Laurence Fletcher

LONDON, Nov 22 (Reuters) - The euro hovered near a four-year high against the yen and rose against the dollar as investors positioned for a robust German business sentiment survey that is likely to show a continued rebound in Europe's largest economy.

The euro was marginally lower at 136.26 yen, having earlier hit 136.54 yen in Asian trading. Against the dollar it was 0.1 percent up at $1.3489.

At 0900 GMT Germany's closely-watched Ifo sentiment of business sentiment is expected to show that business morale rose slightly this month.

The euro was supported by comments from European Central Bank President Mario Draghi, who played down the possibility of the bank implementing negative deposit rates. Reports on negative rates had pressured the euro on Wednesday, adding to losses after the minutes from the U.S. Federal Reserve.

"It's going to be pretty important," said Peter Kinsella, currency strategist at Commerzbank, referring to the Ifo survey.

"Given Draghi came out yesterday to pour cold water on imminent negative deposit rates, if you get a good number you'll definitely get a move higher in euro/dollar."

But analysts at Morgan Stanley said market expectations of an improved reading opened "the way for disappointment".

"We view rebounds in euro/dollar as providing renewed selling opportunities. We have introduced a euro/dollar bearish strategy to our medium-term portfolio," they said in a note.

The dollar, meanwhile, retreated from a four-and-a-half-month high of 101.36 yen against the yen as investors took profits after a month-long rally. The dollar was 0.1 percent down at 101.03 yen.

Japanese stocks hit six-month highs on Friday, helped by comments by Bank of Japan Governor Haruhiko Kuroda, who said the economy is growing in line with the bank's projections and the 2 percent inflation goal will likely be achieved by the fiscal year to March 2016.

The Nikkei and the yen have been moving in counter-step for months, with every rally in the share index a signal for speculators to dump the yen. A lower currency then promises to boost Japanese exports and earnings, further supporting shares.