"It's unfortunate that we had to make a couple of changes, but the guys that have come in certainly deserved their positions," Daley said at ANZ Stadium.
"Obviously James has been knocking down the door. Dugan was going to be there for game one and Wade was going to be there for game two so I thought the right thing was to give those guys an opportunity."
Graham missed game two due to suspension.
Despite his axing, Moylan remains a big part of Daley's plans.
"He took it as how you would want him too, disappointed but determined to be back," Daley said.
"Matty will be back he is a long term Origin player for NSW. He is guy we have huge amounts of respect for."
After 15 Origin games, it is hard to see Greg Bird, 31, pulling on the Blues jersey again.
"He has been a mainstay of our team for several years and it is always hard to leave those guys out," Daley said.
"But when we looked at it we wanted to bring Wade in and we wanted to reward Tyson (Frizell) and Jack (Bird) as well."
NSW: James Tedesco, Blake Ferguson, Michael Jennings, Josh Dugan, Josh Mansour, James Maloney, Adam Reynolds, Aaron Woods, Robbie Farah, Paul Gallen, Wade Graham, Josh Jackson, Tyson Frizell.
Interchange: Jack Bird, David Klemmer, Andrew Fifita, James Tamou. Development players: Tom Trbojevic, Jake Trbojevic, Bryce Cartwright.