* Japan exporters tiptoe into market to sell dollar
* Market looking to comments by U.S. Treasury's Geithner
* Japan PM Kan says will take decisive steps as needed
By Hideyuki Sano
TOKYO, Sept 16 (Reuters) - The yen crept higher on Thursday but the market was on the alert for more intervention by Japanese authorities after a massive amount of yen-selling the previous day knocked the yen off a 15-year high against the dollar.
Some traders see the likelihood of another round of intervention increasing if the dollar slips back below 85 yen.
Japan sold an estimated 2 trillion yen ($23 billion) on Wednesday, a record for a single day, in a move seen as aimed at showing its resolve to curb yen strength.
The market is also watching what U.S. Treasury Secretary Tim Geithner might say later in the day about Japan's intervention, which boosted the dollar by more than 3 percent, its biggest daily gain against the yen in almost two years.
"Intervention will likely continue for a while, perhaps for quite a long time, because once authorities start it, it's not something that they can stop easily," said a trader at a major Japanese bank.
Prime Minister Naoto Kan reiterated on Thursday that Japan would take decisive steps on yen rises if needed, Jiji news agency reported.
The dollar fell about 0.5 percent to 85.30 yen as some Japanese exporters took advantage of its jump to sell dollars earned overseas, pushing it off Wednesday's high of 85.78 yen hit on electronic trading platform EBS.
The dollar sprang up from a 15-year low of 82.87 yen on Wednesday after Japanese authorities, concerned that the yen's rise will hurt the economy by squeezing exporters' profits, stepped into the market for the first time in six years.
Traders have said Japanese exporters wanted to sell the dollar above 85 yen before their half-year book-closings at the end of September. sagged while the premiums market players pay for dollar puts over dollar calls shrank, suggesting option market players see a reduced chance of the dollar's plunge against yen.
The one-month dollar/yen risk reversal spread stood at 0.825/0.575 in favour of dollar puts, the smallest in about five months.
Many traders think it is too early to tell if Japan's latest campaign to dampen the yen's strength will succeed partly because of the uncertainty over how Japan's intervention will be perceived by other Group of Seven (G7) partners.
That makes Geithner's testimony to the Senate Banking Committee at 1400 GMT all the more important as Japan's intervention could be complicating his efforts to persuade China to let the yuan appreciate.
Any criticism by Geithner of Japan's intervention could spark speculation that Japan may scale back its activity, dealers said.
On Wednesday, U.S. lawmaker Sander Levin, who chairs the U.S. congressional committee examining China's currency policy, described Japan's intervention as "deeply disturbing".
Geithner will tell lawmakers in prepared testimony that China's yuan currency has risen too slowly and he is examining what tools may be needed to persuade Beijing to move faster.
The euro traded at 110.76 yen, now down about 0.7 percent on the day and off a one-month high of 111.63 yen struck on Wednesday.
The euro was little changed against the U.S. dollar at $1.2992, off a one-month high of $1.3037 hit on Wednesday.
The New Zealand dollar slipped half a U.S. cent to around $0.7260 after the country's central bank signalled that interest rates would likely not rise as far or fast as many had expected.
The head of the Reserve Bank of New Zealand (RBNZ), Alan Bollard, said the kiwi's strength was not justified by the country's fundamentals, pushing the kiwi to five-month low against the Australian dollar. (Additional reporting by Masayuki Kitano and Aiko Hayashi; Editing by Edwina Gibbs)