FOREX-Dollar edges higher but outlook wary

* Swiss franc, Japanese yen remain supported

* Leveraged trades under stress after Wednesday moves

* Graphic: World FX rates in 2017 tmsnrt.rs/2egbfVh

By Saikat Chatterjee

LONDON, Aug 10 (Reuters) - The dollar rose against a trade-weighted basket of currencies on Thursday as investors consolidated positions with the low-yielding Swiss franc and Japanese yen supported amid deepending anxiety over tensions between the United States and North Korea.

"The markets are looking for direction after Wednesday's sharp moves and geopolitical concerns will dominate investor mindsets in the coming days," said Esther Maria Reichelt, an FX strategist at Commerzbank in Frankfurt.

The dollar index was trading 0.2 percent up at 93.73. It hit a 15-month low of 92.548 on August 2.

The Swiss franc and Japanese yen had notched up impressive gains against the dollar on Wednesday after U.S. President Donald Trump warned North Korea that it would face "fire and fury" if it threatened the United States.

That prompted North Korea to say it was considering firing missiles at Guam, a U.S. Pacific island territory.

The jump in the franc had prompted hedge funds to unwind leveraged positions which involved borrowing in the weak Swiss currency and investing the proceeds in the relatively higher-yielding Australian dollar and the Canadian dollar.

The Swiss franc and Japanese yen are often sought in times of geopolitical tension or global financial stress, partly because both countries have big current account surpluses.

Japan is the world's biggest creditor nation and there is an assumption Japanese investors may repatriate their foreign holdings in times of heightened global uncertainty.

The euro edged 0.3 percent lower to 1.1726 against the dollar. It has weakened 1.5 percent since hitting a 2-1/2 year high of 1.1910 on Aug. 2.

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets (Reporting by Saikat Chatterjee; Additional reporting by Masayuki Kitano in SINGAPORE)

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