* Nikkei poised for third straight negative week
* Charts show Nikkei oversold, global economy worry weighs
* Market awaits U.S. GDP data, Bernanke speech for cues
By Elaine Lies
TOKYO, Aug 27 (Reuters) - Japan's Nikkei average slipped back towards a 16-month low on Friday, with investors nervous ahead of a speech by Federal Reserve Chairman Ben Bernanke and the release of U.S. gross domestic product data later in the day.
The annual Federal Reserve conference in Jackson Hole, Wyoming, where Bernanke will give his thoughts on the U.S. economy, is making investors cautious given the uncertainty surrounding U.S. economic recovery.
"It had appeared that risk avoidance might be starting to abate slightly, but with poor figures expected for the U.S. GDP data later today there's a lot of wariness in the market," said Nagayuki Yamagishi, a strategist for Mitsubishi UFJ Morgan Stanley Securities.
"In addition, U.S. indicators recently haven't been very good, especially housing-related ones, so there'll be a lot of market attention on what Bernanke says for hints as to what sort of policy steps the Fed might take, and that could affect the dollar/yen rate."
The dollar eased slightly against the yen, edging down to 84.36 yen, after hitting a 15-year low earlier this week.
The benchmark Nikkei shed 0.8 percent or 73.53 points to 8,832.73, not far from a 16-month low of 8,807.41 hit on Wednesday, and appeared poised for its third straight negative week, its worst such run since April.
The broader Topix lost 0.6 percent to 806.83.
One target for the Nikkei stands at 8,697, a 61.8 percent retracement of the rally between its March 2009 low and April 2010 high. But otherwise market players say there are few technical targets below 9,000.
Charts showed the Nikkei remains oversold, although it edged slightly above its lower Bollinger Band after falling through it on Wednesday. But its relative strength index (RSI) stood at 33, with 30 and under seen as oversold, with its slow stochastic -- a measure of how oversold the market may be -- still deep in oversold territory.
Market players have said that the longer the Nikkei stays below 9,000, which became a key support level several times over the past year, the greater the chance that strong resistance will develop at that point.
EXPORTERS, TECHS
U.S. stocks initially rose on data showing first-time claims for jobless benefits fell more than expected last week, but the number was still too high to signal a shift in the weak labour market and the four-week average of such claims rose to a 9-month high. All three Wall Street indexes ended down.
Tech shares slipped after their U.S. peers fell, with the Philadelphia Semiconductor Index losing 2 percent. Tech shares are often seen as a proxy for U.S. growth.
Kyocera Corp lost 1.8 percent to 7,110 yen and TDK Corp shed 0.8 percent to 4,260 yen.
Exporters slipped as well, with Honda Motor Co down 0.7 percent at 2,748 yen and Toyota Motor Corp losing 0.8 percent to 2,906 yen.
Brewer Kirin Holdings fell 3.2 percent to 1,150 yen after saying it would acquire the shares it did not already own in wine maker Mercian Corp via a stock swap. Mercian shares surged 6.8 percent to 158 yen.
Shares in Resona Holdings were up 0.7 percent at 916 yen, a day after Japan's fourth-largest bank said it would pay back about $4.7 billion in public money by buying back preferred shares.
Resona will still owe the government about 1.7 trillion yen ($20 billion) from bailouts received in the late 1990s and when it was effectively nationalised in 2003 after nearly collapsing under a mountain of bad loans. (Editing by Michael Watson)