NZD/USD stays in green above 0.6820 despite USD strength
- US Dollar Index stays in upper-half of daily range.
- GDT Price Index rises 4.2%.
- China's new measure to boost the economy helps NZD stay resilient on Tuesday.
On the back of China's introduction of new measures to jumpstart the slowing economy allowed currencies such as the NZD and the AUD gather strength. After advancing to a fresh 3-week high of 0.6850 earlier in the day, however, the NZD/USD pair lost its traction and retreated toward the 0.68 area. With the bi-weekly GDT auction yielding a 4.2% increase in the Price Index, the pair retraced its losses and was last seen trading at 0.6825, where it was up 0.05% on the day.
On the other hand, the data from the U.S. showed that the Empire State Manufacturing Index slumped to 3.9 in January to fall short of the market expectation of 10.75 and the annual core PPI remained steady at 2.7%. Finally, the IBD/TIPP Economic Optimism Index edged down to 52.3 from 52.6. Despite the gloomy data, the US Dollar Index didn't have a difficult time preserving its daily gains as investors continue to stay away from European currencies amid Brexit uncertainty and dismal macroeconomic data releases from the euro area.
Later in the session, Kansas Fed President George is scheduled to deliver a speech. In the early Asian session, electronic card retail sales data from New Zealand could impact the kiwi's market valuation.
Technical levels to consider
The initial resistance for the pair aligns at 0.6850 (daily high) ahead of 0.6910 (Dec. 11, 2018, high) and 0.7000 (psychological level). On the downside, supports are located at 0.6800 (50-DMA), 0.6770 (Jan. 10 low) and 0.6730 (Jan. 9 low).