Chart of the Day - Wednesday, October 11, 2023

Today’s Chart of the Day was shared by Aksel Kibar (@TechCharts). The US Dollar ($DXY) is on a 6-day losing streak, after snapping an 11-week winning streak last week. Stocks have caught a bid in reaction to the Dollar's newfound weakness. However, we're about to find out whether this was just a well-deserved pullback within an uptrend or the start of a more significant decline for the Dollar. Aksel points out that $DXY is testing the January/March highs, around $105. $DXY cleared this resistance level last month, but if it doesn't turn into support soon, it will mark a failed breakout. Failed breakouts are often followed by sharp moves lower, which in this case, would be very beneficial for stocks. On the other hand, stock market bulls can forget about a year-end rally if $DXY inflects higher at this pivotal level.