The Big Lie: The Dollar’s Stabilising

What They’re Saying

Markets are quieter, dollar's "off the lows", and the message is: things are settling down. The narrative now is that tariff volatility has passed and investors can regroup. But if you’re looking at price — not headlines — there’s no real recovery here. Just a dead-cat bounce in slow motion.

What Actually Happened

Let’s deal in facts.

• DXY printed 99.47 today, barely bouncing from Friday’s spike low under 99.00, which marked the sharpest two-week drop since 2022.

• The structure is obliterated — lower highs since February, and now a clean break below December 2023 support.

• EUR/USD? Still holding strong. Hovering around 1.1330, it’s off the high but barely — and this comes after a near vertical 600-pip climb from March lows.

This isn’t strength in the dollar. It’s stalling after a liquidation move. The fundamental driver — chaos around tariffs — hasn’t changed. Trump adds levies, then walks them back. Phones and electronics got spared this weekend, but the message is clear: policy is reactive, not strategic.

And when macro leadership is volatile, capital pulls back — especially from dollar assets.

Don’t let the quiet price action fool you. Compression doesn’t mean resolution — it means uncertainty.

The DXY is in a decision zone:

• Below 100 is uncharted territory since early 2022.

• No meaningful bid has stepped in yet.

• The recent grind higher in yields hasn’t rescued it — which tells you it’s a trust problem, not a rate one.

EUR/USD remains in breakout territory:

• Resistance at 1.1340–1.1470 dates back to early 2021. That’s the zone being tested.

• Price hasn’t rejected yet. No topping structure. Just digestion after a parabolic run.

This price action doesn’t support the idea of a dollar recovery. It supports caution — and maybe one more squeeze lower if sentiment turns again.

Strategy Angle

If you’re trading FX/CFDs in this mess, you already know the game:

• Get in, get out. No roll risk, no swap gouging. Don’t sleep on positions in this tape.

• Watch false breaks — especially on the dollar index.

• Algorithms are running stop hunts on both sides around the 99.50–100.20 area.

• Sentiment is fragile. No one’s committing. That’s not the time to plant flags — it’s the time to stay liquid and surgical.

This isn’t about being bullish or bearish USD. It’s about not getting steamrolled by fake stability.

Chart Reads

DXY Daily

Structure has broken. Clean downtrend. Failed support from Dec 2023 has become resistance. Market paused, not reversed.

EUR/USD Daily

No fade yet. Breakout is holding. Traders watching 1.1340–1.1470 zone for signs of exhaustion — none showing so far.

Setup That Might Be In Play

Not advice. Not a signal. But these are zones worth studying:

• DXY 99.00–100.20: Expect noise, fakeouts, and algo games. Look for reaction, not prediction.

• EUR/USD 1.1340–1.1470: Supply zone from early 2021. Will only matter if price respects it — so far, it hasn’t.

Final Thought

The dollar isn’t stabilising. It’s stalling. Don’t trade the pause like it’s a floor.

Disclaimer: This post reflects my personal views and experience from over three decades in financial markets. It is shared for educational purposes only and is not financial advice. It does not promote any trades or guarantee outcomes. Always do your own research and manage your risk. Trading is high risk and not suitable for everyone. Choose regulated brokers, understand leverage, and never trade based on opinion alone. This is a market journal, not a signal service.