• DXY abruptly changes direction and advances past 109.00.
• The next up barrier emerges at the YTD high near 110.80.

DXY now challenges 3-day highs in the mid-109.00s following an unexpected change of heart among investors in the wake of higher-than-expected US CPI.

The short-term bullish view in the dollar remains in place as long as it trades above the 7-month support line near 106.30. That said, and in light of the current price action, another move to the 20-year highs around 110.80 (September 6) should not be ruled out in the near term.

Looking at the long-term scenario, the constructive view in DXY remains unchanged while above the 200-day SMA at 101.46.

DXY daily chart