Dollar index daily perspective U.S. Dollar Currency IndexTVC:DXYShavyfxhubThe daily line chart remains in bullish trajectory and 102$-101.98 is inevitable,the resilience is mind blowing following last FOMC economic projections and the new chair Kevin Warsh hawkish rhetorics, the rate hold at 3.5%-3.75% helped reinforce bullish sentiment and restore capital inflow into safe haven ,both the dollar index and the US10Y is holding strong,its note worthy that on monthly timeframe the US10Y is on monthly support showing signs that yield could continue to climb into 5% by year end if fundamentals stay’s elevated and favorable . What is Dxy??? DXY , U.S. Dollar Index measures the value of the U.S. dollar (USD) against a weighted basket of six major foreign currencies.  Basket Composition (Weights) • Euro (EUR): 57.6% (dominant component) • Japanese Yen (JPY): 13.6% • British Pound (GBP): 11.9% • Canadian Dollar (CAD): 9.1% • Swedish Krona (SEK): 4.2% • Swiss Franc (CHF): 3.6%  Base value: Established at 100 in 1973. • DXY > 100 → USD is stronger than in 1973. • DXY < 100 → USD is weaker.  It is calculated as a geometric mean and traded via futures on ICE. How DXY and Interest Rates RELATIONSHIP • Higher U.S. interest rates (e.g., rising Fed Funds Rate or US10Y Treasury yields) → Attract foreign capital seeking better returns → Stronger USD → Higher DXY.  • Lower U.S. interest rates → Reduce USD attractiveness → Weaker USD → Lower DXY. US10Y yields and DXY often move together (positive correlation), though it’s not perfect due to other factors like economic data, inflation expectations, or risk sentiment.  Example in context: From the last FOMC meeting where FOMC members voted unanimously 12-0 to keep rate the same 3.5-3.75% followed the chair hawkish rhetorics .such hawkish policy plus rising US10Y yields can rise → DXY dollar index Other influences on DXY include: • U.S. economic data (strong GDP, employment → higher DXY). • Geopolitics and risk sentiment (USD as safe-haven → higher DXY in turmoil). • Relative central bank policies. How DXY Affects Other Currency Pairs DXY has a strong inverse relationship with most major USD pairs because a stronger dollar makes other currencies relatively weaker (and vice versa).  • Inverse correlation (DXY ↑ → pair ↓): • EUR/USD (heavily influenced, due to EUR’s large weight). • GBP/USD — rising DXY pressures GBP/USD lower). • AUD/USD, NZD/USD, etc. • Positive correlation (DXY ↑ → pair ↑): • USD/JPY, USD/CAD, USD/CHF (these move with the dollar).  In GBP/USD terms: • Strong DXY (strong USD) → Downward pressure on GBP/USD (harder for GBP to rise). • Weak DXY (weak USD) → Supports higher GBP/USD, amplifying any positive rate/yield differentials for the UK. Practically as a forex trader you have to watch DXY charts alongside pairs for confirmation. A breakout in DXY can signal broader moves across majors DXY is a sentiment and relative strength tool rather than a direct cause, but it’s highly interconnected with rates and yields. Dxy market structure is pivotal to buy/sell strategy on daily /weekly time frame #DXY #dollar