* Euro recovers footing after falling to $1.0600
* Dollar index touches 7-month high
* Aussie slips vs dollar as commodities slide (Updates prices, adds comments)
By Patrick Graham
LONDON, Nov 23 (Reuters) - The euro was marginally steadier in early trade in Europe on Monday after hitting its lowest in more than 7 months in Asian time, traders with interest from options markets repelling a first attack on $1.0600.
Robust sentiment surveys from the euro zone offered the single currency support, but traders and analysts were reluctant to predict any bounce before a European Central Bank meeting next month that is expected to ease monetary policy.
Latest positioning data showed players again increased bets on the dollar against the euro in the week to last Tuesday. The last fortnight has proved more sticky for the U.S. currency, however, raising the prospect that some investors could choose to take profit on its 5 percent surge since mid-October or this year's more than 12 percent gain.
"We got very close to $1.06 overnight so I there probably is a good chance we might push through that this week," said Josh O'Byrne, a strategist with Citi in London.
"There's not going to be much to go on though data-wise. The market is long dollars, short euro and I don't expect that we will see much of a squeeze on those positions ahead of next week's ECB."
The Japanese yen was also weaker against the dollar ahead of a week lightened in trading terms by a holiday in Japan on Monday and the Thanksgiving holiday in the United States.
By 0855 GMT, the yen was down 0.3 percent at 123.125 yen JPY= . The euro inched down 0.1 percent on the day to $1.0632, after trading as low as $1.0600 in Asian time, a 7-month low.
That, allied to almost 1-percent falls in the New Zealand and Australian dollars, allowed the U.S. currency to touch a 7-month high of 99.977 against a basket of currencies. .DXY
Most major banks have stuck firmly to the view that the euro will fall toward parity with the dollar in the months ahead as the Federal Reserve begins to lift interest rates while the ECB takes the opposite course.
Comments by European Central Bank President Mario Draghi on Friday reinforced expectations for the ECB to unveil more monetary stimulus at its policy meeting on Dec. 3, renewing pressure on the euro.
"Our view of the euro stays firmly negative," said Heng Koon How, senior FX strategist for Credit Suisse (VX:CSGN) private banking and wealth management in Singapore.
The yield spread between two-year U.S. Treasuries and German Bunds has widened in the dollar's favour due to the monetary policy divergence between the Fed and the ECB, weighing on the euro, he said.
He pointed to two-year U.S. Treasury yields US2YT=RR that are now 130 basis points above two-year German bond yields DE2YT=RR , compared to around 81 basis points in October.
The euro touched a four-month low against the Australian dollar at A$1.4679 earlier on Monday, but later recovered as a slide in commodity prices weighed on the Aussie. (Editing by Angus MacSwan)