The US Dollar Index (DXY) rallied on the back of rising treasury yields, confirming Tuesday's bullish hammer pattern. The next obstacle for dollar bulls is last week's highs at 80.40, above which confirms a higher double bottom base. A swing low could form near the 79.87 region, where the 20-day moving average and 100-day moving average overlap. A sustained loss of this pivot would suggest a third test of the 38.2% retracement level at the 79.20 level.
The British Pound was the weakest performer of the major currencies following a surprisingly weak employment report. The GBP/USD collapsed through its upward tilting channel then rejected near formation support. The 2-day retreat has wiped out nearly all of the gains from the previous two weeks. This bearish development suggests an imminent re-test of the November low at 1.5480. The Sterling also reached new lifetime lows against the Aussie and Swissy, as focus shifts to tomorrow's UK retail sales report.
The USD/JPY broke above the recent 84.40 ceiling to signal further strength towards 84.82/85.40 (between the 2009 former low & the September 24th spike high). Only a daily close below the formerly resistant 110-day moving average delays dollar bulls.