ASIA: Coming Up In Asian Markets On Thursday

The NZD/USD had a range overnight of 0.5952 - 0.5989, Asia is currently trading around 0.5955. The NZD failed above 0.6000 and drifted lower as the USD got a lift from risk moving lower. A bit of a mess is the best way to describe the situation with the market a little unsure on how to trade it. The pivotal resistance toward 0.6100-0.6150 continues to cap for now and the dovish read of the RBNZ has delayed its challenge in the short-term. On the day, price remains in the potential 0.5885-0.6015 range, I will be watching to see if the USD bears can regain control. Failure to do so would risk a move sub 0.5900 which could potentially signal a deeper pullback. 

• “The EU voted to freeze ratification of its US trade deal after the Supreme Court upended Trump’s tariff plans, while India is said to have more wiggle room in its talks with the White House. The US president warned trading partners not to “play games.” - BBG
• Options : Closest significant option expiries for NY cut, based on DTCC data: none. Upcoming Close Strikes : 0.5695(NZD577m Feb 27), 0.5950(NZD358m Feb 25) - BBG
• The NZD/USD Average True Range for the last 10 Trading days: 53 Points

Fig 1: NZD/USD Spot Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P

• RES 3: 135.35 - 38.2% retracement of the Apr 7 ‘25 - Jan 21 bear leg   
• RES 2: 133.99 - 100-dma 
• RES 1: 132.96 - High Feb 18
• PRICE: 132.64 @ 20:54 GMT Feb 23
• SUP 1: 131.06 - Low Feb 9
• SUP 2: 130.66 - Low Jan 19 and the bear trigger
• SUP 3: 129.06- 1.500 proj of the Aug 6 ‘24 - Mar 26 - Apr 7 ‘25     

JGBs are trading closer to their recent high. The latest recovery has seen the contract trade through both the 20- and 50-day EMAs. This highlights a stronger short-term reversal and signals scope for a continuation higher. An extension would pave the way for a climb towards 133.99, the 100-dma. Key support has been defined at 130.66, the Jan 21 low. Clearance of this level would resume the downtrend.

The AUD/USD had a range overnight of 0.7049-0.7091, Asia is currently trading around 0.7055. The AUD could not follow through with the early spike seen in Asia and the USD actually bounced overnight in response to the turn lower in risk. A bit of a mess is the best way to describe the situation with the market a little unsure on how to trade it. On the day, I will be watching to see if the buyers can hold above this 0.7035-0.7055 area and try to build for another push above the 0.7100 area. If this support does not hold we could potentially see a deeper pullback. The risk around an Iran strike is still around and the market will be looking towards tomorrow's Australia CPI as well.

• MNI - Australia January Inflation: January monthly CPI prints next Tomorrow. The consensus looks for a slight downmove in headline CPI to 3.7%y/y (from 3.8%) but trimmed mean, the RBA's preferred underlying inflation measure is expected to be steady at 3.3%. The monthly CPI series remains fairly new from a time series standpoint and the RBA is still likely to place greater weight on the quarterly inflation prints. The Q1 print isn't out until April 29. Still, the January figures will be eyed for any signs of persistent inflation pressures. The RBA is watching such trends closely to determine whether and/or by how much they need to tighten policy rates further to ensure inflation returns to the 2-3% target.
• Options : Closest significant option expiries for NY cut, based on DTCC data: 0.7025(AUD561m). Upcoming Close Strikes : 0.6900(AUD1.68b Feb 25), 0.7000(AUD2.81b Feb 25), 0.7100(AUD2.11b Feb 25) - BBG
• The AUD/USD Average True Range for the last 10 Trading days: 65 Points
• Data/Event: RBA’s Michael Plumb speaks at the 2026 ABE Annual Forecasting Conference in Sydney

 Fig 1: AUD/USD spot Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P