Asian equities markets have an incredibly bearish end to February. The Nikkei 225 closed with a 3.67% or 805.27-point loss at 21,142.89. Meanwhile, the Hang Seng Index is down by 2.49% or 665.6 points at 26,113.1. The Shanghai Composite Index is in the red by 3.71% or 111.025 points at 2,880.304.
In a statement today, WHO warned that the coronavirus may soon become a pandemic with cases outside of China rising at a worrying pace. The number of coronavirus cases in South Korea has gone over 2,000 from being under 150 at the start of the week. Denmark and New Zealand also reported their first cases of the infection. In Japan, schools have been suspended to avoid the coronavirus from spreading. WHO urged policymakers to take actions to prevent the infection because failure to do so could turn the coronavirus into a pandemic.
It also did not help that there were earlier reports today of rising tensions in the Middle East. 33 Turkish soldiers were reportedly killed by a Syrian airstrike this morning. The incident consequently led to speculations of more conflict in the region after the US reiterated its allegiance to Turkey following the incident.
Currencies also traded in favor of safe haven assets this morning. AUDUSD is trading around its March 2009 lows as it slid to 0.6514. USDJPY is trading 81 pips below its opening price at 108.77. Meanwhile, NZDUSD fell 73 pips from its open to intraday low price at 0.6230.
On the monthly time frame, we can see that NZDUSD has made its way to its October 2019 lows. If AUDUSD is any indication of the price action on NZDUSD, the latter could soon fall below this support level and tap new decade lows. A close below the October 2019 low at 0.6202 would set 0.5000 as the next floor. This price is where NZDUSD bottomed in 2009.
If the currency pair fails to close below its October lows, it could indicate that there are still buyers lurking in the market. We could soon see NZDUSD trade higher to its December 2019 highs at 0.6730.