Geopolitical Risk Weighs

Wednesday was a day of two halves for AUD/USD. Spillover from hawkish RBNZ Monetary Policy Statement and improving risk backdrop outweighed unimpressive Australian wage data and pushed the pair higher in early trade but demand petered out in the London/NY crossover as geopolitical jitters returned. The U.S. announced wider sanctions against Moscow, while another batch of source reports flagging potential of an imminent Russian invasion did the rounds.

• Although the pair showed above Feb 10 high of $0.7249 during its initial upswing on Wednesday, the subsequent pullback led to the formation of a shooting star candlestick. Today's price action will be watched for confirmation of that bearish signal.
• The rate has shed a handful of pips in early trade, as risk assets took a mild hit after Ukrainian President Zelensky said his Russian counterpart did not respond to a phone call request. AUD/USD last changes hands at $0.7229.
• Bears keep an eye on Feb 14 low of $0.7086 and a break here would signal potential for further weakness. Conversely, bulls would be pleased by gains past Jan 13 high of $0.7314, a key near-term resistance.
• Quarterly private capex data takes focus in Australia today.