GDT price index preview: What to expect of NZD/USD?

By FXStreet Global Dairy Trade (GDT) will release its dairy price index, which has gained relevance lately, as approximately 7% of New Zealand GDP comes from milk exports.

The index is published every two weeks and uses a weighted-average of the percentage changes in dairy prices sold at auction.

The latest reading on February 2nd showed a 1.6% decline in the price index compared to it previous release. “Futures trading has suggested there may be another overall drop in prices in excess of 5% at this week’s GlobalDairyTrade auction, with the key Wholemilk prices perhaps dropping as much as 10%”, said David Hargreaves from interest.co.nz.

NZD/USD technical levels

Ahead of the auction, NZD/USD was trading at 1-week lows around 0.6580, 1.0% below its opening price as the risk-off mood weighs on the commodity complex. A negative GDT reading could potentially weaken further the New Zealand dollar.

As for technical levels, next supports could be found at 0.6560 (21-day SMA), 0.6508 (Feb 3 low) and 0.6448 (Feb 1 low). On the flip side, resistances are seen 0.6625 (100-day SMA), 0.6683 (200-day SMA) and 0.6738 (Feb 12 high).
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Source:: FX Street