Richard Perry
Independent Analyst
There has been a 7th consecutive higher low on the daily chart which is a positive, however the appearance of a "long legged doji" candlestick pattern (open and close at the same level with an intraday test to the downside) is a warning sign. Momentum indicators have now unwound to neutral and this could be a case of the bull recovery beginning to run out of steam. Yesterday's low at 102.38 now becomes key support. With the high coming at 102.72 yesterday, the legacy of the old 102.83 pivot level could still be holding back the advance of the dollar. On the intraday chart, perhaps an early warning signal could be a breach of the rising 89 hour moving average (now 102.51) which has supported the recovery. Furthermore, the rate has made very little ground in the past two days. Perhaps it is time to pull up stop-losses or profit triggers on long positions.
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