- GDT price index rises in today’s auction.
- US Dollar Index recovers toward 97 in the NA session.
After extending its rally to the highest level since mid-June at 0.6968, the NZD/USD pair lost its traction in the second half of the day and erased the majority of its daily gains. As of writing, the pair was trading at 0.6935, up only 0.1% on a daily basis.
Easing concerns over the potential negative impact of the trade conflict between the U.S. and China on New Zealand’s economy following the announcement of 90-day trade-truce boosted the demand for kiwi at the beginning of the week. However, with the positive effect of trade optimism fading amid a lack of any fresh developments, the kiwi struggled to preserve its momentum.
Although the bi-weekly GDT auction yielded an increase in GDT prices for the first time in 14 auctions, the pair failed to reverse its direction. Later in the Asian session, the ANZ will release its Commodity Price report.
On the other hand, the US Dollar Index, which fell to 96.40 area, retraced a big portion of its daily drop after New York Fed President Williams said that the U.S. economy was strong and he would continue to support further gradual rate hikes. At the moment, the DXY is down 0.08% on the day at 96.88.
Technical levels to consider
The pair could face the first resistance at 0.6970 (daily high) ahead of 0.7000 (psychological level) and 0.7060 (Jun. 6 high). On the downside, supports could be seen at 0.6890 (Dec. 3 low), 0.6840 (Nov. 29 low) and 0.6780 (200-DMA).
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