TOKYO (AFX-ASIA) - The dollar was little changed at midafternoon due to a lack of follow-through buying after it regained the 120 yen level on short-covering earlier, dealers said. Sumitomo Trust and Banking chief customer dealer Jitsuo Tachibana said trading was nervous ahead of bilateral talks between US Treasury Secretary Paul O'Neill and Finance Minister Masajuro Shiokawa. "The market is not likely to find new direction in the dollar/yen trade until this meeting, especially after the release of the US job data prevented acceleration in bull sentiment for the dollar," he said. According to the released data, the US jobless rate rose last month to 4.9 pct, its highest level in 5 years, from 4.5 pct in July. "But, few participants expect the bilateral meeting to offer anything surprising," Tachibana said. O'Neill said in Beijing the management of foreign exchange rates to redistribute wealth is not an appropriate policy tool. Tachibana said that now that bull sentiment towards the dollar has receded, there is the chance of testing year-to-date lows against the yen this week. "But, the most likely scenario is that the dollar will be traded in the 181.50-121.50 yen range, rather than finding fresh direction," he said. The euro was firmer on continued short-covering thanks to the sustained fall on Wall Street and the weak US jobs data, dealers said. "As people now have a big question mark on the sustainability of a strong dollar, the euro is expected to continue its solid performance," Sumitomo's Tachibana said. "But, it may take some time before the unit regains the 0.91 level and make clear headways above such level."