NZD/USD turns sharply lower on disappointing GDT Price Index

Having failed to sustain a move beyond 0.7300 handle, the NZD/USD pair extended its reversal and has now dropped to a fresh session low, flirting with 50-day SMA support. 

Currently trading around 0.7250 region, the pair ran through fresh offers following the outcome of latest dairy auction and the fortnightly release of GDT Price Index that showed prices for daily products fell by 3% following a rise of 1.7% at the previous auction.

Moreover, a broadly stronger US Dollar, amid reviving hopes of an eventual Fed rate-hike action by the end of this year, is also contributing to the pair's ongoing reversal from session peak level of 0.7311.

From technical perspective, the pair is hovering around 50-day SMA immediate strong support, which if broken decisively would suggest a break down and might trigger a fresh leg of depreciating move in the near-term.

Technical levels to watch

On a sustained weakness below 0.7250 region (50-day SMA), the pair is likely to immediately dart towards 0.7220-15 horizontal support before breaking below 0.7200 handle and aiming towards testing 100-day SMA support near 0.7135 region.

Meanwhile on the upside, 0.7300 handle remains immediate strong hurdle above which the pair could witness a short-covering bounce initially to 0.7330 intermediate resistance and eventually towards 0.7355-60 strong horizontal resistance.