NZD/USD drops to daily lows near 0.7260 despite upbeat GDT outcome

GDT Price Index rises 4.9% in the last auction.
DXY extends recovery in the early NA session.

Eren Sengezer FXStreet

The NZD/USD pair pushed lower in the early NA session and refreshed its daily low at 0.7261. As of writing, the pair was trading at 0.7265, losing 0.28% on the day.

The pair's price action on Tuesday continues to be dominated by the positive mood surrounding the greenback. After closing four straight days sharply lower, the US Dollar Index finally took a breather on Tuesday. The DXY, which plummeted to a three-year low near the 90 mark on Monday, is now at 90.55, up 0.45% on the day. In the meantime, although the headline general business conditions index of the Empire State Manufacturing Survey eased to 17.7, the fact that labor market conditions, new orders and selling prices sub-indexes didn't allow the report to have a negative impact on the USD.

On the other hand, following the previous 4.2% increase, the GDT Price Index rose by 4.9% at the end of today's auction but failed to help the kiwi retraces its losses against the buck.

Technical outlook

The pair could encounter the first technical support at 0.7225 (Jan. 12 low) ahead of 0.7150 (200-DMA) and 0.7075 (Jan. 4 low). On the upside, resistances align at 0.7315 (Jan. 15 high), 0.7415 (Sep. 20 high) and 0.7500 (psychological level).

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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