US traders were out for the President’s Day holiday, contributing to lower trading volumes. POTUS made a surprise visit to Kyiv as part of a three-day trip in Europe to mark the war anniversary in Ukraine, and China called for a political resolution to the conflict.
Despite thin trading on Monday, crude oil managed to advance 1.11% to $77.25/bbl on the back of future supply concerns and increased demand from China. Bears regained market control early Tuesday, with the $75/bbl in focus.
The minutes of the last meeting indicated that the RBA had considered hiking by either 25 or 50bps. Members noted that wages had increased more than expected and saw wages rising higher than anticipated for the year’s final quarter. Australian flash manufacturing PMI came in at 50.1, compared to 50.0 prior. Aussie gained 0.47% to 0.6911 but is under pressure early Tuesday. Losing 0.6877 could open the door towards 68 cents unless bulls attempt 0.6937.
EU foreign ministers met to discuss the 10th sanctions package on Russia but concluded without an agreement. Ambassadors will meet in the coming days to finalise the deal by Thursday. EUR/USD closed mixed at $1.0683 on Monday, with traders shifting focus to $1.0736 and $1.0615.
Japan’s flash Manufacturing PMI fell to 47.4 from 48.9 prior, the fourth contraction in a row. USD/JPY did not move much on Monday, and it closed the session at 134.30.133.00 and 135.00 are critical levels to keep an eye on. If it is any respite, the BOJ governor nominee Ueda is at least confirmed to deliver remarks before Japan’s upper house on Feb 27.
There was initial optimism that a deal on the NI protocol could be reached after PM Rishi Sunak and EU’s von der Leyen spoke over the weekend. But reportedly, Sunak had to put the deal on hold after facing strong opposition from the DUP and some Tories. Cable was unchanged at $1.2050 and has support and resistance at $1.1986 and $1.2075.
Bitcoin’s price is close to breaking its 8-month high at $25250, boosted 2.5% on Monday by investors’ continued inscription to “ordinals” after upgrades on SegWit and Taproot. This surge comes as the SEC continues to charge cryptocurrency exchange with fines. The next significant resistance is settled at $28k, with support at $24280.