On September 20, the Dollar Index posted an outside up day by trading on both sides of the previous day’s range and settling above its high.
The rally that it signaled was completed in the middle of last week as DXY made new 20-year highs and then reversed lower and settled below the previous session’s low.
This key reversal saw follow-through selling to a new five-day low ahead of the weekend slightly above 111.55. That nearly met the (62.8%) retracement of the advance from September 20 (~111.45). Initial resistance is now near 112.80 and then 113.20. The MACD and Slow Stochastic are rolling over in over-extended territory. The 20-day moving average, the middle of the Bollinger Band is near 110.80.