* President Yanukovich repeals anti-protest legislation
* Ukraine currency slumps to 4-1/2 year low
* Abducted activist reappears, says he was "crucified"
By Richard Balmforth
KIEV, Jan 31 (Reuters) - Ukraine's embattled President Viktor Yanukovich on Friday signed into law an amnesty for demonstrators detained during mass unrest and repealed anti-protest legislation, in a fresh bid to take the heat out of the political crisis.
But the move by Yanukovich, which demonstrated he remains politically active despite going on sick leave on Thursday, was not likely to be enough to end the sometimes violent anti-government protests on the streets of Kiev and other cities.
And TV coverage of a prominent opposition activist showing marks of torture inflicted by mystery kidnappers - along with reports police tried to arrest the man in hospital - fuelled anger that has become so explosive that the army made a rare statement, calling for urgent moves to ease the tension.
Many protesters rejected Yanukovich's amnesty outright, because it is conditional on occupied buildings being cleared of activists, and a radical Ukrainian nationalist group behind much of the violence pressed new tough demands on Friday.
The 63-year-old leader, who looks increasingly isolated in a tug-of-war between the West and Ukraine's former Soviet overlord Russia, suddenly withdrew from view on Thursday, complaining of a high temperature and acute respiratory ailment. He was not seen in public on Friday.
Opposition leaders, citing fears for demonstrators' health from Arctic temperatures, urged their supporters not to take to the streets in large numbers for weekly rallies on Sunday.
But with some television channels replaying repeated video of opposition activist Dmytro Bulatov, abducted a week ago, displaying wounds inflicted by his assailants, fury at the government shows no sign of letting up.
"There's no point in signing this amnesty law," said Olena, working at an improvised clinic at Kiev's occupied city hall.
"No one will leave here until this government is gone."
The uncompromising standoff, triggered by Yanukovich's decision in November to accept a $15-billion loan package from Russia instead of a trade deal with the European Union, prompted a rare intervention from the military on Friday.
The Defence Ministry urged the president, as commander in chief, to move swiftly, and within the law, to end the crisis.
"The military and the Ukrainian armed forces ... called on the supreme commander to take immediate steps, within the framework of the law, to stabilise the situation in the country and reach agreement with society," it said in a statement.
Earlier this week, Ukraine's first post-Soviet president warned that the country was on the brink of "civil war".
The military has emphasised its unwillingness to take sides throughout the unrest and seems concerned not to be drawn in. In covering Friday's statement, a Defence Ministry news website quoted one retired admiral, Serhiy Rybak, recalling Ukrainian troops' roles in peacekeeping after civil wars abroad: "No political ambition is worth a drop of human blood," he said.
NATO Secretary General Anders Fogh Rasmussen tweeted that he was "very concerned by attempts to involve the military in the crisis" and added that the "military must remain neutral".
At least six people have been killed, all in the past two weeks, and hundreds more injured in street battles between anti-government demonstrators and police, which have escalated sharply after the authorities toughened their response.
KERRY TO MEET OPPOSITION
The crisis forced Prime Minister Mykola Azarov to resign this week, and as yet there is no sign of a successor. Serhiy Arbuzov, Azarov's first deputy and a close family friend of Yanukovich, has stepped in as interim prime minister.
Underlining its economic leverage over Ukraine, Moscow says a new government must be in place before it goes ahead with a planned purchase of $2 billion of Ukrainian government bonds.
That reluctance, and the turmoil more generally, contributed to a 2.5 percent fall in the value of the hryvnia currency against the dollar on Friday to its lowest level for 4-1/2 years.
U.S. Secretary of State John Kerry plans to meet opposition leaders, including boxer-turned-politician Vitaly Klitschko, on the sidelines of a security conference in Munich on Friday.
"Our message to Ukraine's opposition will be the full support of President Obama and of the American people for their efforts," Kerry said in Berlin on Friday before the meetings.
"But we will also say to them that if you get that reform agenda... we would urge them to engage in that because further standoff, or further violence that becomes uncontrollable, is not in anybody's interests."
Kerry also called on Russia to keep its distance.
"We would ... say to our friends in Russia this does not have to be a zero (sum) game, this is not something where Ukraine should become a proxy and trapped in some kind of larger ambition for Russia or the United States."
"They crucified me. They punctured my hands," he said, pointing to marks on the backs of his hands. "They cut off my ear, slashed my face," he said. "But I am alive, thank God."
The United Nations' human rights office called for an investigation into reports of kidnappings and torture, and European Union foreign policy chief Catherine Ashton said she was appalled by signs of torture inflicted on Bulatov.
"All such acts are unacceptable and must immediately be stopped," she said in a statement.
A far-right nationalist group called Right Sector, seen as being behind violent clashes with police in Kiev, meanwhile demanded the release of activists held by police, threatening to take the law into their own hands to free their comrades.
"If they refuse, appropriate steps will be to taken to free these people and not only constitutional methods will be used," Right Sector leader Dmytro Yarosh told reporters.
Right Sector, a paramilitary group whose violent actions have appalled opposition leaders and peaceful protesters, also said it wanted to play a direct role in any negotiations for a settlement between Yanukovich and opposition leaders, he said.
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