NZD/USD in a 30-pip range above 0.7200 after 7-day decline

• In the absence of major macroeconomic news NZD/USD is mainly led by USD sentiment. 
• The US Dollar Index (DXY) failed to break above the 91.00 mark on three occasions on Tuesday.
• The 10-year US bond yields reached 3.003% but there is no follow-through on DXY.

The NZD is trading at around 0.7111 down 0.53% on Tuesday. 

The kiwi is trading in a tight 30-pip range just above the 0.7100 handle. The antipodean currency is led by the sentiment on the US dollar promoted by the rising US benchmark Treasury yields.

The greenback is currently at a key technical level on the US Dollar Index (DXY). The index measures the strength of the buck relative to a basket of currencies. DXY is at a 8-week high trading now in the 90.90 region after attempting to break above the 91.00 level on three attempts on an intraday basis on Tuesday. 

The US dollar is following a surge in the US Treasury yields. The 10-year benchmark has reached today 3.003% level (4-year high) in what can be an exhaustive move according to analysts as DXY is not confirming a move higher. 

On the data front, the salient events of the week will be on Friday. Investors will closely watch the US Personal Consumption Expenditure price index (PCE). It is the favorite gauge of inflation of the Federal Reserve Bank, therefore, a strong deviation to the upside will reinforce rate hike expectations. The US GDP is scheduled on the same day. The first quarter US GDP is expected to rise to 2.3% on a quarterly annualized basis.

Earlier in the session, the US data came broadly above consensus. The US Housing Price Index for February came in above forecast at 0.60% versus 0.50% expected by analysts. The New Home Sales accelerated to 0.694 M versus 0.630 M while the New Home Sales Change rose to 4.00% against 1.90% forecast by analysts. Howere, the tier-two data is unlikely to steal the show from the action in the bond market.

NZD/USD daily chart 

The main trend is bearish and the bulls are attempting to create a pullback. Support is seen at the 0.7100 figure and at 0.6954 swing low while resistance is priced in at 0.7153 swing low, 0.7200 figure and at the 0.7300 figure.