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NZD/USD testing 0.6850 ahead of Fonterra’s dairy auction

FXStreet (Mumbai) - The NZD bulls picked-up significant strength this session, pushing NZD/USD further beyond 0.68 handle, and finally snapping the 2-day decline ahead of the GDT price index data due later today.

NZD/USD rises to daily R2 at 0.6847

Currently, the NZD/USD pair trades 0.759% higher at 0.6842, testing 0.6850 – key psychological levels. The bird is flying through the roof mainly on the back of a corrective rally, as markets anticipate another rise in the dairy prices reflected by the Fonterra's Global Dairy Trade (GDT) Index. The GDT price Index has risen sharply at the last four fortnightly auctions, rebounding more than 30% from the lows seen in August.

While gains across the commodity-currencies on the back of stabilizing oil and rebounding gold prices, also contributes to the upsurge in the NZD/USD pair. Later in the US session, a set of housing data from the US and Fed Chair Yellen’s remarks will remain in focus.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.6881/6900 (Oct 16 High & round number), above which it could extend gains to 0.6964 (200-DMA) levels. To the downside immediate support might be located at 0.6806/04 (hourly 20 & 50-SMA) below that 0.6744 (hourly 200-SMA).

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