Can I create a list of my favorite dashboards which is available on top of the page when I select Dashboards?

Is there an option in the Dashboard menu when I can select number of Dashboards as a favorite that can appear at top of the page?

Yes you can

Just wait for version 192 !!!

Saas has it now, Managed users might have to wait a week or two

Using Dynatrace SaaS but cannot see favourite toggle button. Does it need any specific permission or license?

For anyone seeing this, a way of “favourite” would be to add a dashboard to your dock like so :