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The US Dollar Index (DXY) is gaining bullish traction once again as price lifts to 100.18, breaking above the closely watched 100.00 psychological barrier. With RSI rising firmly into bullish territory and moving averages providing support beneath current price, the dollar’s momentum looks the strongest it’s been in weeks — and traders are now eyeing the next resistance zone near 101.00–101.50.
Technical Outlook: Dollar Strength Returning With Force
The latest DXY daily chart shows a clear strengthening trend:
- The 15-day and 20-day moving averages are rising and tightening beneath price — a classic bullish continuation signal.
- DXY is now trading above both moving averages, showing a full shift in short-term momentum.
- The RSI (14) sits at 63.51, signalling healthy upward momentum, but not yet overbought — a combination that often precedes further gains.
This is the strongest technical configuration for the dollar in months.
Macro Context: Fed-Hawkish Bias + Stabilizing Yields = Dollar Support
Several macro factors continue to support the dollar’s renewed strength:
Bullish Drivers
- Ongoing expectations that the Federal Reserve will maintain a higher-for-longer rate stance
- Firm U.S. economic data, including employment and services indicators
- Stabilizing U.S. Treasury yields after a volatile summer
Global Context
- Mixed economic performance in the Eurozone, UK, and China continues to push investors toward USD safety
- Risk sentiment remains cautiously optimistic but fragile — typically USD-friendly
This cocktail of factors is giving the dollar a clear macro tailwind.
Key Technical Levels to Monitor
|
Level |
Significance |
|
101.00–101.20 |
Immediate resistance / breakout zone |
|
102.00 |
Medium-term bullish target |
|
99.68–99.78 |
Key support (MA cluster) |
|
98.90 |
Trend invalidation level |
If DXY can break and close above 101.00, momentum could drive a larger rally toward 102.00.
If price slips back below 99.70, the bullish structure weakens — but as long as 98.90 holds, the trend remains intact.
Sentiment Check: Traders Increasing USD Exposure
Sentiment is gradually shifting in favour of the dollar:
- Institutional desks have begun adding tactical USD longs
- Retail sentiment remains mixed, leaving room for a momentum-driven squeeze
- Options markets show elevated call volume near the 101 strike
This positioning supports the idea that a larger bullish leg may still be ahead.
The US Dollar Index has broken a major psychological barrier at 100.00 and now shows consistent bullish alignment across technical indicators.
With momentum strengthening and fundamentals supportive, the dollar may be preparing for a larger upside extension toward 101–102.
A breakout above 101.00 sets the stage for a run toward 102.00.
A drop below 99.68 would weaken momentum but not fully reverse the trend.