Federal Reserve Board member Stephan Miran said monetary policy has tightened without the Fed actively doing more. He said the central bank could cut interest rates and still support economic growth. He said the Federal Reserve is one of the biggest risks to growth, and that policy may be tighter than many people think. He also said that inflation—after adjusting for measurement biases—is very close to the Fed’s target and that prices are broadly stable.

Implications For Policy And The Labor Market

Miran said there is some slack in the labour market and that monetary policy has room to help. He said it makes sense to support the labour market with easier policy, and he estimates the natural rate of unemployment at 4%. He said he is not worried about inflation unless rents rise sharply. He also said the impact of tariffs has not shown up in inflation data. He said the US fiscal outlook is improving and that US growth is outperforming, which supports the US dollar’s reserve-currency status. At the time of writing, the US Dollar Index (DXY) was around 97.00, up 0.10% on the day. Because monetary policy appears to have tightened passively, we believe the Federal Reserve has room to lower interest rates. The latest core Consumer Price Index (CPI) reading for January 2026 was 2.1% year over year, which supports the view that inflation is very close to the Fed’s target. That suggests the risk of an inflation spiral is low and gives policymakers more flexibility.

Trade Positioning And Market Impact

These comments could shift expectations for the Fed’s next move and make rate cuts in the second quarter more likely. Derivative traders may want to position for a more dovish path using Secured Overnight Financing Rate (SOFR) futures, with at least one or two cuts priced in before the end of the summer. Buying call options on Treasury note futures (ZN) may also be a practical way to benefit from falling yields. For equity markets, this outlook is supportive because lower rates raise the value of future earnings. We may consider buying call spreads on the S&P 500 (SPX) or Nasdaq 100 (NDX) to take advantage of a potential rally in growth-focused sectors. This would reduce concerns about a Fed-driven slowdown that has been weighing on stocks. Despite the recent strength in the U.S. Dollar Index, a clear shift toward easier policy would likely weaken the currency. Q4 2025 GDP growth of 2.5% highlights US outperformance, but interest-rate differences still drive currency markets. We could consider buying puts on U.S. Dollar Index futures or buying calls on EUR/USD in anticipation of this change. Labour market data also supports this view. The January unemployment rate rose slightly to 4.2%, and annual wage growth slowed to 3.5%. This suggests there is slack in the market, which gives the Fed room to focus on employment without triggering inflation. This is a meaningful change from the tighter labour market seen through much of 2024. A similar pattern appeared in early 2019. The Fed shifted from a tightening stance to an easing stance, and risk assets rallied as markets stopped pricing in hikes and began pricing in cuts. Miran’s comments suggest a similar shift could be developing now. Create your live VT Markets account and start trading now.

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Silver traded near $76.60 during Asian hours on Friday, after falling more than 11% late Thursday. The drop came as stocks shifted into risk-off mode and silver slid in a fast sell-off, likely driven by algorithmic trading. The decline followed weakness in technology shares and market moves linked to worries about Artificial Intelligence. Margin calls were also mentioned as a factor that may have added to losses in precious metals.

Fed Expectations And Rates Outlook

Markets now expect the Federal Reserve to keep interest rates higher for longer after strong US jobs data. Higher rates can pressure non-yielding assets like silver. Markets price in about a 92% chance of no change at the next meeting. The chance of a cut by June is close to 50%, based on the CME FedWatch tool. The Silver Institute said on Tuesday that global silver demand is expected to be steady in 2026. It also said that gains in retail investment should offset most declines in industrial, jewellery, and silverware demand. Traders are watching the US CPI report due later on Friday for clues. Headline and core CPI are expected to be 2.5% year on year in January. Silver is now trying to stabilize around $76.60 after the sudden 11% plunge. The move appears to have been driven by algorithmic selling during the risk-off slide in technology stocks. The CBOE Volatility Index (VIX), a key gauge of market fear, jumped above 22 yesterday. That suggests broader market stress, not just a silver-specific move. Higher implied volatility also makes option premiums more expensive and signals that traders expect large price swings.

Cpi Scenarios And Trading Positioning

Attention now turns to the US Consumer Price Index (CPI) report due later today. If inflation comes in above the 2.5% forecast—similar to upside surprises seen in late 2025—it would reinforce the Federal Reserve’s “higher for longer” stance. That outcome would likely pressure silver again, since it does not pay interest. For derivatives traders, this setup may favor buying put options to hedge against another drop, especially ahead of the CPI release. The recent 11% move shows how fast prices can fall, so downside protection matters. If inflation surprises on the soft side, short-dated call options can offer a leveraged way to trade a rebound from oversold levels. This kind of sharp move echoes the flash crash seen in August 2021 and highlights how quickly liquidity can dry up. Because volatility is high, long straddles or strangles may make sense in the coming weeks. These strategies aim to profit from a large move in either direction, without needing to predict the Fed’s next step. Beyond the near-term macro headlines, fundamentals may offer support. The Silver Institute recently pointed to weaker jewellery demand. Even so, industrial demand from solar and electric vehicle production remains strong, reaching a record 215 million ounces in 2025. That underlying demand could help create a price floor once the current wave of speculative selling fades. Create your live VT Markets account and start trading now.

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On Friday, the People’s Bank of China (PBoC) set the USD/CNY central rate at 6.9398, compared with 6.9457 the previous day. The PBoC’s monetary policy goals include keeping prices stable (including the exchange rate) and supporting economic growth. It also carries out financial reforms, such as opening up and developing China’s financial markets.

Pboc Governance And Independence

The PBoC is state-owned and is not seen as independent. The Secretary of the Chinese Communist Party Committee, nominated by the Chairman of the State Council, can influence the PBoC’s management and direction. Pan Gongsheng currently holds that role and is also the PBoC governor. The PBoC uses several policy tools, including the seven-day Reverse Repo Rate, the Medium-term Lending Facility, foreign exchange intervention, and the Reserve Requirement Ratio. The Loan Prime Rate is China’s benchmark interest rate. It affects loan, mortgage, and savings rates, and it can also influence the Renminbi exchange rate. China has 19 private banks. WeBank and MYbank are the largest digital lenders. In 2014, China allowed domestic lenders funded entirely by private capital to operate in the state-dominated financial sector. The PBoC has shown a clear preference for a stronger yuan by setting the daily fix meaningfully lower. A similar move in 2025 signaled an effort to shape market expectations and steady the currency. This suggests the central bank is comfortable with current economic momentum and is guiding the yuan higher against the dollar.

Market Implications For Yuan Direction

Recent economic data supports this view. China’s trade surplus for January 2026 widened to $82 billion, which can support currency strength. Consumer inflation also rose to 1.9% last month. A stronger yuan can help lower the cost of imported goods and energy. The PBoC may be using the exchange rate to manage price pressures without changing interest rates. For derivatives traders, this managed rise points to lower near-term volatility in USD/CNH. Selling short-dated option straddles to collect premium could be a workable strategy, since firm central bank guidance may keep the pair in a tighter range. Consistent fixes that come in stronger than expected also reduce the chance of sudden, sharp moves. Given this, it may make sense to position for more yuan strength in the coming weeks, but likely in a gradual way. This could include buying USD/CNH puts or using bearish call spreads to benefit from a slow move lower. The key point is that the PBoC is signaling a direction, not creating a shock. That tends to favor strategies that benefit from steady trends rather than sudden spikes. Historically, when the PBoC has defended or guided the yuan with this level of intent (as in late 2023), it has often been followed by weeks of consistent policy actions. This suggests the current move may not be a one-off, but the start of a short-term policy push. As a result, the central bank may also use other tools, such as the Medium-term Lending Facility, to support this currency strength. A stronger yuan can also be a headwind for export-focused Chinese companies, since overseas earnings may translate into fewer yuan. Traders could consider options on major Chinese equity indices, such as buying puts on ETFs with heavy export exposure. This can help hedge against these secondary effects of the policy signal. Create your live VT Markets account and start trading now.

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MUFG expects USD/MYR to keep trending lower, with a target of 3.7000 by end-2026. It links this view to a longer phase of ringgit strength, supported by structural factors. Malaysia is in an ICT-led investment upswing. Total approved investments in manufacturing and services rose 14.7% year-on-year in 9M25. ICT was the biggest contributor, with ICT investment approvals up about 32% year-on-year over the same period. Inflation is seen as under control, despite changes to RON95 fuel subsidies and adjustments to the sales and services tax. Bank Negara Malaysia is expected to keep its policy rate at 2.75% through 2026. Rate gaps should also narrow as US policy becomes less restrictive. Net foreign inflows into Malaysian bonds have been increasing since 2024. Supportive external factors include firmer commodity prices, strong demand for electronics, and a steady Chinese yuan. Key risks include a sharp slowdown in global growth, weaker commodity prices, or a downturn in the global electronics cycle. The article also notes it was produced using an AI tool and reviewed by an editor. We expect USD/MYR to continue falling, with a year-end target of 3.7000. This is based on the view that a durable ringgit appreciation cycle has started. The setup looks attractive for positioning over the coming weeks. For traders who want to express this view, buying USD put options with three- to six-month maturities is a practical approach. This strategy benefits if USD/MYR falls, while limiting losses if the market moves the other way. Given the steady downtrend, traders can initiate these positions now to capture the expected move. This view is supported by Malaysia’s ICT-led investment cycle, which strengthened through 2025. Full-year 2025 data from the Malaysian Investment Development Authority (MIDA) showed a 15% year-on-year rise in total approved investments. Foreign direct investment into the tech sector remains a key driver. Macroeconomic stability also supports a stronger ringgit. Inflation in January 2026 was 2.1%, suggesting the subsidy changes from last year were absorbed without major strain. This gives Bank Negara Malaysia room to keep rates steady, helping preserve the ringgit’s yield advantage. That stability is showing up in capital flows. BNM data for January 2026 reported another month of solid net foreign inflows into the local bond market, extending a positive trend that began in 2024. Ongoing demand for Malaysian debt directly supports the currency. External conditions also look helpful, especially for electronics. Industry reports for January 2026 showed global semiconductor sales up 8% year-on-year. This supports Malaysia’s export-heavy economy and adds to the case for ringgit strength. Even traders who are long USD/MYR should pay attention to downside risk. The fundamentals are strong enough that hedging a potential drop in USD/MYR makes sense. Buying out-of-the-money puts can be a relatively low-cost way to protect against faster-than-expected ringgit gains.

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Vertiv Holdings, LLC (VRT) provides digital infrastructure and business continuity solutions. The shares jumped 24.49% in one session and closed at $248.51. An ascending resistance trendline from mid-2024 has stopped rallies, with several tests in 2025. This trendline sits at the top of an ascending channel that has guided the climb from the $60–70 range to today’s levels. This latest surge brings price back into the resistance area, near the trendline and the $275.40 level. How the stock behaves around the trendline and $275.40 is the next key signal. If VRT holds these gains and moves above $275.40, the next area to watch is $290–300. If price fails at the trendline or at $275.40, the pullback zone described is $220–230. The near-term setup is simple: either price breaks through resistance or it gets rejected. The next few sessions should make it clear which path is developing. As of today, February 13, 2026, Vertiv is in focus after a huge 24% jump to $248.51. This move pushed the stock straight into the ascending resistance trendline that has capped rallies since mid-2024. The main question is whether this starts a major breakout or sets up a sharp rejection. This rally looks driven by fundamentals, not only technicals. A January 2026 International Energy Agency report said data center electricity use is on track to double by the end of the decade. That trend supports demand for Vertiv’s power and cooling products. This adds to the case that long-term institutional buying could overwhelm past resistance. For traders looking for a breakout, call options with strike prices above $275.40 are a direct way to target more upside. March or April contracts leave time for a push through resistance and a test of the $290–300 area. A similar pattern showed up in NVIDIA’s 2024 run, where a break above a key level led to a fast acceleration. But implied volatility is now very high after such a large one-day move, which makes long options expensive. A more conservative bullish approach is to sell out-of-the-money put credit spreads below the $220 support area. This collects premium while betting the stock can at least hold most of its gains. If you believe the trendline will hold, as it did through 2025, buying puts is a direct way to play a pullback. A failure at resistance could send the stock back toward the $230 support area. After such a sharp run, the stock is exposed to a quick reversal if momentum fades. A higher-probability bearish trade is to sell a call credit spread with the short strike just above $275.40. This can profit from both time decay and a pullback if Vertiv cannot clear that level in the next few weeks. With volatility elevated, premiums for these spreads are currently attractive.

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Applovin Corporation (APP) has moved out of its expansion phase and into a correction. The price is falling toward a rising trendline near **$364.25**. Instead of looking for breakouts, the key task now is to see whether this support level holds. The stock is testing **$364.25** under selling pressure and is nearing a long-term support area. If it stays above **$364.25**, that would support the case for a short-term rebound off the trendline. If the price bounces from **$364.25**, two resistance levels stand out as possible exit targets: – **$449.06** (a prior support level) – **$504.09** (the area where the recent sell-off began) A close below **$364.25** would break the rising-trendline support and invalidate the near-term support idea. If that happens, the next support level is **$317.15**. Looking back to the 2025 analysis, the stock sold off sharply into this key area. The **$364.25** trendline was the main inflection point and helped define a major low before the later recovery. Fundamentals are currently stronger. Last quarter’s earnings showed **48% year-over-year revenue growth to $1.15 billion**, which points to improving momentum. If you expect a similar rebound after a retest of support, **call options** or **bull call spreads** could be ways to express that view. The AI-driven advertising engine continues to support strong growth in the software platform. Still, the downside risk matters. If the broader market weakens, the stock could break below a major support level—similar to the bearish scenario traders worried about in 2025. More bearish traders could consider **put options** to hedge or to position for a move toward **$317.15**. Because the stock is near another decision point, it also makes sense to watch **implied volatility** closely. If you expect a large move but don’t have a strong directional view, a **long straddle** could fit. This strategy can profit from a sharp move in either direction—up through resistance or down through support. Use the 2025 levels to help guide option strike selection in the coming weeks. A move above **$449.06** would be strongly bullish. A failure at **$364.25** could reopen the path to **$317.15**. Watch **trading volume** for confirmation either way.

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Pound Sterling fell 0.36% on Thursday as risk aversion increased demand for the Japanese Yen. GBP/JPY traded at 209.09 after hitting a daily high of 209.55. Fresh worries about disruption from AI pushed Wall Street lower. However, Gold, Silver, and the US Dollar did not benefit much from the shift into safer assets.

Technical Outlook Shifts

The broader trend is still up, but the drop below the 50-day simple moving average (SMA) at 210.87 has shifted the outlook to neutral-to-bullish. First support sits near a trendline in the 207.00 to 207.20 area. The Relative Strength Index (RSI) shows bearish momentum, which suggests more short-term downside. If the pair falls below 207.00, the next supports are the 100-day SMA at 206.85 and the 16 December swing low at 206.77. If selling pressure continues, the next support is the 1 December low at 205.20. On the upside, a move above 208.50 brings resistance at 209.00, then 209.55, and then 210.00. In the analysis from this time in 2025, GBP/JPY was trading near 209.00 as AI disruption fears boosted the yen. That bearish momentum signal proved right over time. The pair is now struggling below 199.00. What started as an early technical breakdown has since turned into a clear downtrend.

Updated Macro Backdrop

Right now, the fundamental picture for the pound looks weak, giving little reason to expect a strong rally. UK inflation has cooled to 2.5%, down sharply from prior years. As a result, the Bank of England is openly discussing rate cuts in the second half of 2026. This outlook limits how much the pound can strengthen. On the other side, the yen has regained support that was missing in early 2025. The Bank of Japan finally ended negative interest rates late last year. While its benchmark rate is still just 0.10%, the contrast versus a more dovish Bank of England is clear. This policy gap continues to support the yen against the pound. With this backdrop, it may make sense to prepare for further downside or sideways trading in the coming weeks. Buying put options with strikes below the 198.00 support level would benefit from another drop. If you expect the pair to stay capped below resistance, selling call options with a strike near the psychological 200.00 level can be a way to collect premium. Create your live VT Markets account and start trading now.

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NZD/USD traded around 0.6050–0.6057, close to a two-week high of 0.6057. Markets are watching the Reserve Bank of New Zealand (RBNZ) statement on February 18 and any changes in expected rate paths for the RBNZ or the Federal Reserve. The RBNZ is expected to hold the Official Cash Rate at 2.25% after 325 basis points of cuts since August 2024. Recent New Zealand data showed unemployment at 5.4% and employment growth at 0.5% (vs. a 0.3% forecast). Markets are pricing roughly a 75% chance of a rate hike by September.

Us Data And Fed Expectations

In the US, January Non-Farm Payrolls rose by 130K. This pushed the expected start of Fed rate cuts from June to July. January CPI is due next, with forecasts of 0.29% month-on-month for headline CPI and 0.39% for core CPI. On the technical side, the pair held above 0.6000 after the February 6 low of 0.5937 and is trading near a 0.6050 pivot. Resistance sits near 0.6100. RSI is around 55. The 50-day SMA is near 0.5950, with the 200-day SMA below that. On the 1-hour chart, NZD/USD has been range-bound between 0.6030 and 0.6060. A break above 0.6100 would target 0.6120–0.6150. A move below 0.6000 could open a path toward 0.5950. With NZD/USD compressed in a tight range around 0.6050, the near-term focus is today’s US CPI release. We see this as a binary event, which can make short-dated options strategies like straddles or strangles appealing for a potential volatility spike. A softer-than-expected inflation print could be the trigger that pushes the pair above the current consolidation.

Strategy Into Rbnz Meeting

Looking ahead to next week’s RBNZ meeting on February 18, the key factor will be forward guidance. A hold at 2.25% is already priced in, but any language that supports the market’s 75% odds of a September hike would likely be bullish for the Kiwi. We think traders could consider March call options with strikes above 0.6100 to position for a hawkish surprise. The fundamental backdrop is gradually improving for the Kiwi, which is a shift from most of 2025. A continued rise in the Global Dairy Trade index, which has rebounded from last year’s lows, would support New Zealand’s terms of trade. This strengthens the view that the RBNZ may be finished cutting rates earlier than the Fed. The main medium-term theme is policy divergence between the RBNZ and the Fed. If the Fed does not start cutting until July while the RBNZ begins to lean toward hikes, NZD/USD could strengthen later this year. Call spreads expiring in the third quarter can express this view while keeping risk defined. That said, traders should respect the technical resistance near 0.6100 and the decade-high unemployment rate of 5.4% (levels last seen around 2014–2015). A weaker labor market could limit how hawkish the RBNZ is willing to be and may cap near-term upside for the Kiwi. As a result, bullish derivative positions should be structured with risk controls in case the pair fails at resistance and falls back toward support around 0.6000. Create your live VT Markets account and start trading now.

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AUD/USD fell about 0.5% on Thursday. Even so, it stayed near multi-year highs after pushing above 0.7140, the highest level since February 2023. The drop followed comments from the Reserve Bank of Australia (RBA) that it could raise rates again if inflation stays high. Earlier this month, the RBA raised the cash rate by 25 basis points to 3.85%. Markets now price a 74% chance of another hike in May. They also price in 38 basis points of additional tightening by year-end. Meanwhile, consumer inflation expectations rose to 5% in February, the highest since mid-2025.

Key Macro Drivers

AUD gains were capped by weak Chinese CPI data and ongoing producer price deflation. This points to softer demand and could weigh on Australian exports. In the US, January Non-Farm Payrolls came in at 130K versus 70K expected, and the unemployment rate fell to 4.3%. Focus now shifts to the delayed US January CPI report. Forecasts are 0.29% month-on-month for headline CPI and 0.39% for core CPI. On the technical side, AUD/USD was near 0.7118 after a 0.7148 high. Support sits around 0.7100 and 0.6932, while resistance is at 0.7148, then 0.7200 and 0.7250. With the RBA staying firm on inflation, we still see the path of least resistance for AUD/USD as higher. The policy split remains clear: the US Federal Reserve held rates steady through the second half of 2025, while the RBA continued tightening. This difference supports a bullish view for the Aussie in the weeks ahead. Given the strong uptrend, buying call options is a simple way to express this view. It offers defined risk with meaningful upside. One approach is to target strikes above the key 0.7150 resistance level, such as 0.7200, with March or April expiries to give the trend time to extend. Recent data also shows speculative net-long positions rising for weeks, which suggests the trade aligns with current market momentum.

Risk And Trade Setup

That said, daily RSI is nearing overbought levels. At the same time, worries about Chinese demand are pressuring iron ore prices, which have eased to about $135 per tonne. This raises the risk of a pullback. A practical approach is to treat dips toward the 0.7100 or 0.7050 support areas as chances to start long exposure. Selling cash-secured puts or using bull put spreads at those lower levels can help generate premium while waiting for a better entry. The key near-term event is today’s US CPI release, which is likely to set the tone into next week. A softer inflation print would likely weaken the US dollar and could be the trigger that pushes AUD/USD cleanly above 0.7150. A hotter CPI number, on the other hand, could create the pullback needed to add bullish positions at better prices. Create your live VT Markets account and start trading now.

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New Zealand Business NZ’s Performance of Manufacturing Index (PMI) fell to 55.2 in January, down from 56.1 the month before. A PMI reading above 50 means manufacturing is growing. A reading below 50 means it is shrinking.

Manufacturing Growth Slows

Business NZ’s PMI eased to 55.2 in January from 56.1. It is still clearly above 50, so the sector is still expanding. However, this is the second month in a row that growth has slowed. That downward trend is worth watching over the next few weeks. This softer reading also makes the outlook harder for the Reserve Bank of New Zealand (RBNZ). Inflation is still the main problem. It ended 2025 at 4.5%, which is well above the RBNZ’s target band. With prices still rising too fast, the central bank is unlikely to start easing policy soon. For New Zealand dollar traders, this can limit NZD gains. A slowing economy paired with a hawkish central bank can also raise volatility. That can make option strategies such as straddles more attractive around the next RBNZ decision. If Australian data stays stronger, the odds increase that NZD could weaken versus AUD. In rate markets, the data suggests that expectations for near-term cuts may be too early. The labour market is still tight, with unemployment around 4.0%. That gives the RBNZ room to keep the Official Cash Rate higher for longer. This backdrop may support trades that expect short-term rates to stay elevated rather than fall quickly.

Implications For Markets

Slower manufacturing momentum is a headwind for the NZX 50, especially for manufacturers and exporters. The weaker PMI could lead analysts to cut earnings forecasts for the first half of 2026. Buying put options on the index is one way to position for a possible pullback from recent highs. Create your live VT Markets account and start trading now.

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