NZD/USD ignores GDT auction, remains in tight range amid low volume

The NZD/USD pair is trading in a tight range near the 0.73 handle and is flat on the day as the low trading volume due to the Independence Day holiday in the U.S. doesn't allow any fluctuations.

The latest Global Dairy Trade auction from the New Zealand recorded a 0.4% drop as the average price came in at $3,303 but it was largely ignored. After falling to a daily low of 0.7262 in the Asian session, the NZD was able to take back its losses against the USD.

The early selling pressure on the pair was caused by the sharp fall witnessed on the AUD/USD pair following the Reserve Bank of Australia's monetary policy decision and its statement. AUD/USD lost nearly 70 pips after the RBA disappointed the markets by adopting a neutral stance, pushing the positively correlated NZD/USD pair lower. However, the AUD/NZD pair also faced a selling pressure and helped the NZD find demand and keep the losses against the USD limited.

• RBA: Status quo on rates, no major changes - Westpac

Now with the American traders enjoying their holiday, the pair is expected to continue its consolidation near the 0.73 handle. On Wednesday, the ANZ Commodity Price will be released from New Zealand for June. In may, the data came in at 3.2% and a positive reading could help the kiwi gather some strength against its rivals.

Technical outlook

A daily close above 0.7300 (psychological level/10-DMA) the pair could aim for 0.7375 (Feb. 7 high) and 0.7400 (psychological level/Nov. 8 high). On the downside, supports align at 0.7260 (Jun. 27 low), 0.7200 (psychological level) and 0.7115 (50-DMA).