TOKYO, Dec 15 (Reuters) - Japan's Nikkei share average gained on Friday, supported by a pause in the yen's ascent, which had previously weighed on exporters' profit forecasts.

The Nikkei ended the day up 0.87% at 32,970.55, marking a weekly gain of 2.05%, and decisively ending a two-week losing run.

The benchmark index rose as high as 33,122.33 earlier in the day but lost momentum in the afternoon session, failing to stick above the psychological 33,000 line.

The broader Topix added 0.47%, notching a 0.34% weekly advance.

"For stocks, in the end, investors can't help being obsessed with what's going on in currency markets," said Kazuo Kamitani, a strategist at Nomura Securities.

However, he highlighted the 25-day moving average, at around 33,130, as a potential resistance level for the Nikkei in the near term.

"It seems highly unlikely it'll get above that, even with a weakening yen."

Japan's currency traded at around 142 per dollar on Friday, retreating from the four-and-a-half-month peak of 140.95 reached overnight.

Automaker shares benefited, with Toyota up 1.13%, Nissan gaining 2.94% and Subaru jumping 4.51%.

The yen has strengthened about 5% in three weeks, driven by bets that the Bank of Japan is nearing an exit from negative interest rates, while expectations for the Federal Reserve point to a potential rate cut. The BOJ's next policy decision is scheduled for Tuesday.

Chip-related shares tracked gains in U.S. peers overnight, with chip-testing machinery maker Advantest rallying 3.86% and Shin-Etsu Chemical - which supplies silicon wafers - jumping 5.51%.

Shipping was the best performer among the Tokyo Stock Exchange's 33 industry groups, soaring 6.24%.

Financials underperformed, with the TSE's bank index down 1.8% as a decline in U.S. bond yields signalled lower returns from investing. Insurers dropped 2.08%.

Of the Nikkei's 225 components, 134 rose, while 91 fell. (Reporting by Kevin Buckland; Editing by Rashmi Aich and Dhanya Ann Thoppil)