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NZD: Back Eyeing 0.6100 Test, But Lags Broader USD Drop, AUD/NZD Through 1.1700
NZD/USD rose around 0.65% for Monday's session amid broad USD weakness, tracking near 0.6055 in early Tuesday trade. Late Jan highs of 0.6093 aren't far away, while mid 2025 highs were around 0.6120. Recent lows rest near 0.5925/30, while the breach of the 20-day EMA on the downside (now around 0.5950) wasn't sustained last week. However, for Monday's session, NZD lagged the rest of the G10 in percentage gain terms (except for GBP). The BBDXY fell around 0.65%, the DXY off 0.80%, as a continued rally in precious metals and global equities weighed on USD sentiment.
- A report from late yesterday (Asia Pac time), that Chinese officials urged banks to limit purchases of US government bonds was also USD negative. USD/CNH fell under 6.9200, likely aiding NZD from a spill over standpoint, although the A$ outperformed.
- The AUD/NZD cross broke higher, getting to 1.1723 (last 1.1710/15), as the A$ surged amid the positive outlined above. Upside focus will likely rest in the 1.1800/1.2000 for this cross.
- Via BBG: "ANZ 2025/26 Farmgate Milk Price Revised Up to NZ$9.50/KgMS", it adds: "Although global dairy supply and demand factors haven’t meaningfully improved, dairy prices have rebounded strongly so far in 2026."
- This follows the recent surge in dairy price auctions, which is supporting the NZ terms of trade backdrop.
- The local data calendar remains empty until Friday when the Jan PMI (for manufacturing prints), along net migration for Dec and Q1 inflation expectations (which will be the most important print).
Fig 1: NZD/USD Versus Key EMAs
Source: Bloomberg Finance L.P./MNI
ASIA: Coming Up In Asia Pac Markets On Tuesday
| 2200BST | 0600HKT | 0900AEDT | Fed's Miran In Podcast Interview |
| 2330BST | 0730HKT | 1030AEDT | Australia Feb Westpac Consumer Sentiment Index |
| 2350BST | 0750HKT | 1050AEDT | Japan Jan Money Stocks |
| 0000BST | 0800HKT | 1100AEDT | Australia 2041 Bond Sale |
| 0001BST | 0801HKT | 1101AEDT | UK Jan BRC Sales |
| 0030BST | 0830HKT | 1130AEDT | Australia Jan NAB Business Conditions |
| 0335BST | 1135HKT | 1435AEDT | Japan 10yr Inflation Linked Bond Sale |
| 0600BST | 1400HKT | 1700AEDT | Japan Jan P Machine Tool Orders |
Source: Bloomberg Finance L.P./MNI
USDCAD TECHS: Fading Off Resistance
- RES 4: 1.3929 High Jan 16 and a reversal trigger
- RES 3: 1.3879 High Jan 20
- RES 2: 1.3781 50-day EMA
- RES 1: 1.3725 High Feb 02
- PRICE: 1.3576 @ 16:51 GMT Feb 9
- SUP 1: 1.3568/3482 Low Feb 09 / Low Jan 30 and the bear trigger
- SUP 2: 1.3473 Low Oct 2 ‘24
- SUP 3: 1.3400 50.0% retracement of the 2021 - 2025 uptrend
- SUP 4: 1.3359 Low Jan 31 2024
USDCAD price faded Monday in response to the generally softer USD theme. Market focus is on whether the recovery from the Jan 30 low has now concluded and the broader downside theme can resume. The trend had been oversold, and the recent bounce has allowed this condition to fully unwind - making for a more attractive entry point for shorts. Key support and the bear trigger lies at 1.3482, the Jan 30 low. Resistance to watch is 1.3710, the 20-day EMA.
