The US Dollar Index (DXY) finished modestly higher, continuing gains for the fourth consecutive day. The dollar broke through the 80.820 ceiling, then subsequently rebounded off it to form a daily bullish hammer. The region between the 81.485 peak and the 200-day moving average is the next upside target. Meanwhile, the Proshares Dollar Index ETF (UUP) has rebounded back above 23 and looks poised to test the targeted 24 pivot.
The British pound was a broad winner on the day, rallying 0.84% vs. a trade-weighted basket of currencies. The Sterling exchange-rated index has recovered back to the 20-day moving average since probing below the lower Bollinger band. The GBP/USD holds the key to further sterling gains and will need to clear a resistant downward sloping trendline. Another rejection, however, suggests a re-test of the 200-day moving average.
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