The Australian Dollar posts a fresh monthly high (US$0.7314) on Thursday after staging a strong break above the 60-day Simple Moving Average on Wednesday, around US$0.7250-65.
From the New York close, a Japanese Gravestone Doji was posted. In a Japanese Candlestick chart, this is a Doji candle where prices rallied but came back and closed at the level they started; the open and close are equal.
The Gravestone Doji is a bearish candlestick pattern.
On the flip side, the US Dollar Index, also known as US DXY, which measures the greenback’s strength against a basket of six major peers, posted heavy losses after the U.S. Consumer Price Index and Core Consumer Price index data was released.
Based on the technical assessment, the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator holds a positive signal, although it has buckled.
Meanwhile, the Moving Average Convergence Divergence (MACD) holds a weak positive signal.
From current levels, the overnight’s retreat now looks back to the 60-day Simple Moving Average.
A close beneath US$0.7250-65 should reinstate the bearish sentiment.
Viewing the topside, the immediate resistance is viewed from US$0.7305 to US$0.7330.