NZD/USD hits near four-week lows, 0.72 mark on sight ahead of US GDP

   •  USD continues to benefit from Fed rate hike bets.
   •  Technical selling aggravates the downfall. 
   •  US Q4 GDP growth figures eyed for fresh impetus.

The NZD/USD pair extended its bearish slide further below 50-day SMA and has now dropped to its lowest level in nearly four weeks. 

The new Fed Jerome Powell, during his first congressional testimony, sounded optimistic on the US economic outlook and endorsed gradual increases in the federal funds rate through 2018. 

The comments triggered a sharp US Dollar rally and prompted some aggressive selling around higher-yielding currencies - like the Kiwi. The selling pressure remained unabated on Wednesday and was further fueled by disappointing Chinese official PMI prints. 

Today's downfall could also be attributed to some follow-through technical selling, especially after yesterday's bearish break below 50-day SMA support and hence, an extension of the pair's bearish trajectory, back towards Feb. monthly lows now look a distinct possibility.

Focus now shifts to the US economic docket, highlighting the second estimate of the US Q4 GDP growth numbers, which should provide some fresh impetus later during the early NA session. 

Technical levels to watch

On a subsequent break below the 0.7200 handle, the pair is likely to accelerate the fall towards 100-day SMA support near the 0.7170 region before eventually aiming to test the 0.7100 round figure mark. 

Meanwhile, on the upside, 0.7240-45 area (50-day SMA) now seems to act as an immediate resistance, above which a bout of short-covering could lift the pair back towards the 0.7300 handle en-route 0.7335-40 supply zone.