US Dollar Price Analysis: Bulls are moving in towards Thursday's highs

• DXY bulls are moving in and extending the US rally. 
• US yields are also perky, fuelling the bid. 

In trade on Thursday, the US dollar and US bond yields rose, with the US 2-year topping the highest since 2008 at 4.614%. Federal Reserve Bank of Philadelphia President Patrick Harker who said the central bank is not done with raising its short-term rate target amid very high levels of inflation. His most hawkish of remarks sent yields to fresh cycle highs, the strongest in a decade. He said the Fed has made disappointing progress at lower inflation and added that inflation in 2023 would fall to around 4% and 2.5% in 2024, which is still well above the 2%.The US dollar hit a high of 113.09. The following illustrates a bullish thesis for the day ahead. 

US dollar daily chart

The confluence of the bullish flag pattern and W-formation, with the correction, supported the neckline meeting a 50% mean reversion and trendline likely give fuel for the bulls.

US 2-year yields

The yield is paying out at the highest levels in years and remains on the front side of the trendline. A test into the W-formations support and the trendline support could be underway for the way ahead, but should the yield move higher, the US dollar could fly.