The Australian dollar faced resistance following the release of the Consumer Price Index (CPI) data. While the annual inflation rate of 3.5% showed a decline from the previous quarter, it fell short of expectations.
Initially, the AUD/USD surged in response to the news. However, the price quickly retraced, suggesting that the market may have been disappointed by the slower-than-expected inflation rate.
A technical analysis of the 4-hour AUD/USD chart provides further insights. Despite a recent uptrend, the price has encountered resistance at the 0.680 level, a previous high. The failed breakout attempt and the bearish divergence on the RSI indicator suggest that the bullish momentum may be waning.
While the ascending channel remains supportive for the AUD/USD, the inability to break above 0.680 could lead to a potential correction towards the lower boundary of the channel.
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