Currency Report: It’s Shakeout Season in the Dollar

When a structural trend reaches a turning point… expect volatility. We’re a month into 2026, and the US Dollar is already stirring the pot– making big moves and flirting with the completion of a major top.

Last week, the DXY tapped new four-year lows after violating a critical support shelf around $96. 

This level marks the lower bounds of a multi-month range as well as a touch point in an uptrend nearly 20 years in the making. 

But the breakdown didn’t stick. 

Failed moves tend to fuel fast moves in the opposite direction, and that’s what’s happening now. 

With so much of the bullish playbook currently relying on a weak Dollar, the rebound rally of the past few days has been felt by risk assets far and wide. 

For this reason, we’re dialed in to how price reacts at this key level… here’s a look at the most important chart in the market:

A sustained move above the 100–101 area would flip the switch to risk-off mode for ex-US and weak-Dollar trades. There is still a lot of work to do before that happens.

While we’ve already seen an aggressive unwind in precious metals just over the past few days as the dollar has ripped higher, the more durable weak-dollar themes, namely developed and emerging markets, remain intact. A DXY above 100 probably changes that.

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