The dollar continues to rise as expectations for a cooling in Fed rate cut bets and potential Trump election victory grow

The U.S. dollar continues its upward momentum against a basket of major currencies, reaching its highest level since early August during Thursday’s European session.

Key factors driving the dollar’s strength include the possibility of a Republican victory in the upcoming election, with Donald Trump as the candidate, and robust U.S. economic data dampening expectations for further Federal Reserve rate cuts.

The dollar index has been in a solid uptrend for three consecutive weeks, recovering over 50% of the broader 105.78 to 99.84 decline. A recent break above crucial resistance at 102.95/103.05 (100-day moving average and top of the daily Ichimoku cloud) generated strong bullish signals, supporting the positive technical outlook.

Bulls are now targeting the next significant barriers at 103.51/103.56 (61.8% Fibonacci retracement and 200-day moving average), although overbought conditions on the daily chart could present challenges.

Any limited pullbacks should find support around the 103.00/102.80 zone (the broken 100-day moving average and cloud top) to offer better entry points for buyers.

Attention is now on the release of U.S. weekly jobless claims and September retail sales, which could provide further direction for the dollar.

Res: 103.56; 103.80; 104.00; 104.38
Sup: 103.26; 103.00; 102.81; 102.44