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DXY

ALERT: EUR Broke Out of Long-term Downtrend Vs Currency Basket This is the aggregate EUR index against several currencies called EXY (like DXY) Large downtrend from 2008 was breached this quarter to the upside. The first trigger of trend weakness occurred in the summer of 2017 when EUR index crossed over mid-line and for the rest of time the price has remained there. In 2021, the price has shown a false break to the upside but failed to progress further. That top is the nearest target for the price at 123, which will book +9% profit. The next barrier is located at the top of 2014 of 140 with +24% gain.
TVC:EXYLong
by aibek
XAUUSD - Will Gold Reverse?!Gold is trading between the EMA200 and EMA50 on the 15-minute timeframe and is on its uptrend line. A continued bullish move towards the supply zone will provide us with the next opportunity to sell it with a good risk-reward ratio. We expect a range of $10-$15. Gold prices dropped by 4% on Wednesday, just a day after reaching an all-time high. The decline followed remarks by President Trump that helped ease Wall Street’s concerns about the ongoing trade war with China and tensions between the White House and the Federal Reserve. Throughout this year, gold has seen a substantial rise due to investor fears over the economic consequences of tariffs. Additionally, the metal has benefited from capital fleeing U.S. assets amid political uncertainty under the Trump administration. On Tuesday, Trump reassured markets by stating that he had no intention of removing Jerome Powell as Fed Chair and expressed his expectation that tariffs on Chinese goods would soon be lowered. Trump’s statements supporting Federal Reserve independence and hinting at easing trade tensions with China reignited risk appetite in financial markets, causing gold prices to tumble on Wednesday.Just a day earlier, prices had hit a record high above $3,500, as investors speculated that Trump might attempt to remove Powell. Trump had previously criticized Powell for not cutting interest rates and for warning that tariffs could lead to higher consumer prices. Gold’s price surge this year has been especially notable following Trump’s decision to halt the implementation of sweeping new tariffs initially announced in early April. Gold, as a safe-haven asset not tied to any single national economy—unlike traditional alternatives such as the U.S. dollar or Treasuries, which are subject to U.S. government influence—has become increasingly attractive to investors wary of Trump’s policy decisions. Meanwhile, the International Monetary Fund (IMF) has warned that continued tariff escalation in 2025 could push global public debt to 95.1% of GDP—an increase of 2.8 percentage points from previous forecasts. According to the IMF’s latest “Fiscal Monitor” report, if revenues and output fall significantly below expectations due to tariff-induced pressures, global debt could surpass 117% of GDP by 2027. Investment bank JPMorgan has projected that gold prices could exceed $4,000 per ounce by mid-2026. This forecast is based on expectations of an economic recession, a prolonged trade war, and sustained demand from central banks. However, JPMorgan also cautioned that a sudden drop in central bank demand could threaten this bullish trend. The IMF’s report further estimates that global public debt will climb to 99.6% of GDP by 2030, exceeding even the pandemic-era peak. The IMF has forecasted global economic growth at around 2.8% for 2025. In this scenario, the U.S. budget deficit is projected to decrease from 7.3% of GDP in 2024 to 6.5% in 2025, and further down to 5.5% in 2026, largely due to increased tariff revenues and continued economic expansion. These IMF projections for the U.S. deficit are based on policies announced up until April 2, 2025, and assume that the individual tax cuts enacted in 2017 will expire at the end of this year.
FOREXCOM:XAUUSDShort
by Ali_PSND
GBPUSD - Will the dollar go up?!The GBPUSD pair is above the EMA200 and EMA50 on the 4-hour timeframe and is moving in its ascending channel. If the pair corrects down towards the demand zone, it can be bought in the direction of its rise. According to the latest Reuters survey of economists, U.S.-imposed trade tariffs have had a significant negative impact on the business environment in the United Kingdom. The assessment suggests that global trade tensions, combined with America’s protectionist policies, have undermined the confidence of British companies and investors in the country’s economic outlook. Market pricing reflects expectations that the Bank of England will cut interest rates by 0.84% over the course of this year. The survey indicates that the UK’s GDP growth for 2025 is expected to average 0.9%, down from the previous estimate of 1%. Growth for 2026 is now projected at 1.2%, also lower than the 1.4% forecast made in March. In terms of monetary policy, there is a strong consensus among economists that the Bank of England is on a gradual path toward easing interest rates. Projections suggest that the base rate will decline by 25 basis points each quarter throughout 2025, reaching 3.75% by year-end. Notably, all 67 economists participating in the poll expect the Bank of England to cut rates by 25 basis points at its May 8 meeting, bringing the rate down to 4.25%. Meanwhile, the U.S.Federal Reserve, in its latest Beige Book release, reported that economic activity across the country has shown “little change.” The report detailed that only five districts experienced “modest growth,” three noted activity was “about flat,” and four reported “slight to moderate declines.” The Fed stated, “The outlook in several districts deteriorated notably due to heightened economic uncertainty, particularly stemming from tariffs.” On employment, most districts experienced “little to slight” increases. One district noted a “modest increase,” four reported “slight gains,” another four observed no change, and three recorded “slight declines” in employment levels. At the same time, prices continued to rise across the country. Six districts described price growth as “modest,” while the other six reported it as “moderate.” The Fed explained that most districts expected input costs to rise further due to tariffs. UBS has issued a warning that Donald Trump’s calls for rate cuts may erode confidence in the Federal Reserve’s independence and fuel greater uncertainty in financial markets. UBS analysts believe that reduced investment and consumption in the U.S. economy are primarily driven by increased economic uncertainty, rather than restrictive monetary policy. They emphasize that markets are highly sensitive to any perceived threats against the Fed’s autonomy, and in the current climate, it is this economic volatility—more than interest rate levels—that is harming the economy.
Long
by Ali_PSND
US500 - Will the stock market go up?!The index is located between the EMA200 and EMA50 on the four-hour timeframe and is trading in its descending channel. If the index moves down towards the specified demand zone, we can look for the next Nasdaq buying positions with an appropriate risk-reward ratio. The channel breakdown and the index entering the supply zone will provide us with its next selling position. The chief economist at Citigroup has stated that the imposition of tariffs in the United States constitutes a stagflationary shock to the economy. According to his estimates, there is a 40% to 45% chance of a recession. It is expected that GDP will increase in the second quarter, as consumers rush to make purchases ahead of the new tariffs. However, the most significant negative impact on U.S. economic growth is projected to unfold in the second half of the year. You may have noticed that recent economic statistics are no longer moving markets. The reason is simple: markets are forward-looking and trade on expectations rather than past data. Economic figures reflect what has already occurred, while market pricing focuses on what lies ahead. At this stage, current data has yet to fully reflect the impact of tariffs and trade tensions. Even if weaker numbers emerge, markets may have already priced in the potential resolution of the trade war and an eventual recovery. Experienced traders understand that today’s developments are already factored into prices. What matters now is the outlook for the coming months—the real driver of market direction. Ryan Petersen of Flexport noted yesterday that, three weeks after the U.S.imposed heavy tariffs on Chinese imports, bookings for ocean freight containers have dropped more than 60% industry-wide. He explained that the U.S. imports around $600 billion worth of goods annually from China, with those items valued at approximately $2 trillion at the retail level. He stated that the first ships carrying goods fully subject to the new tariffs arrived on Monday, and shipping volumes are expected to decline in the coming weeks. However, due to high inventory levels, the impact on the retail sector may be delayed. Petersen also expressed concern that a potential rollback of tariffs could introduce a new set of challenges. With ships currently being repositioned globally, a sudden wave of new orders could disrupt logistics networks—especially if markets perceive the suspension of tariffs as only temporary. In my view, no one really knows how this situation will evolve, as a large portion of imports consists of intermediate goods and components used in final products. My guess is that this could lead to a surge in transshipment and even smuggling, though it could just as easily echo the unexpected consequences seen during the COVID era. We are truly venturing into uncharted territory. Petersen concludes: “This is a strange era for global logistics, as we must simultaneously prepare for the unimaginable—like full U.S. self-sufficiency—while also planning for a return to something closer to normal trade relations.”
CAPITALCOM:US500Long
by Ali_PSND
GOLD Goes "Buy The Dip", Following 200-hour SMA Major SupportGold prices have experienced significant volatility over the last days, with conflicting reports on the current trend. According to some sources, gold prices have increased, with spot gold reaching $3,500 per troy ounce, new all the history high on Tuesday, April 22, 2025. The $3,500 milestone has sparked increased interest from investors and market analysts, meaning that Gold spot doubled in price over the past 5 years, 3rd time in history ever. Despite the short-term volatility, gold has shown a strong performance since the beginning of 2025, with an increase of approximately 30-35% year-to-date. Market analysts remain bullish on gold, with some forecasting prices to reach $ 4'000 per ounce in the near term. The main 1-hour Gold spot OANDA:XAUUSD graph indicates on 200-hours SMA technical support, with further upside opportunity due to forming on the chart descending triangle (flat bottom/ descending top) breakthrow. -- Best #GODL wishes, 💖 Your Beloved @PandorraResearch Team
OANDA:XAUUSD
by PandorraResearch
Canadian Dollar vs. US Dollar. The Spring Is Compressing.In previous posts, we have already begun to look at the key drivers of the US outperformance over the past decade. The US market dominance has been largely driven by the rapid rise of tech giants (such as Apple, Microsoft, Amazon and Alphabet), which have benefited from strong profit growth, global market reach and significant investor inflows. Unsatisfactory International Performance Markets outside the US have faced headwinds including multiple stifling sanctions and tariffs, slowing economic growth, political uncertainty (especially in Europe), a stronger US dollar and the declining influence of high-growth tech sectors. The Valuation Gap By 2025, US equities will be considered relatively expensive compared to their international peers, which may offer more attractive valuations in the future. Recent Shifts (2025 Trend) Since early 2025, international equities have begun to outperform the S&P 500, and European and Asian equities have regained investor interest. Global market currencies are also widely dominated by the US dollar. Factors include optimism around the following three big themes. DE-DOLLARIZATION. DE-AMERICANIZATION. DIVERSIFICATION. De-dollarization is the process by which countries reduce their reliance on the US dollar (USD) as the world's dominant reserve currency, medium of exchange, and unit of account in international trade and finance. This trend implies a shift away from the central role of the US dollar in global economic transactions to alternative currencies, assets, or financial systems. Historical context and significance of the US dollar The US dollar became the world's primary reserve currency after World War II, as enshrined in the Bretton Woods Agreement of 1944. This system pegged other currencies to the dollar, which was convertible into gold, making the dollar the backbone of international finance. The United States became the world's leading economic power, and the dollar replaced the British pound sterling as the dominant currency for global trade and reserves. The dollar has been the most widely held reserve currency for decades. As of the end of 2024, it still accounts for about 57% of global foreign exchange reserves, far more than the euro (20%) and the Japanese yen (6%). However, this share has fallen from over 70% in 2001, signaling a gradual shift and prompting discussions about de-dollarization. How De-Dollarization Works Countries looking to reduce their reliance on the dollar are pursuing several strategies: Diversifying reserves: Central banks are holding fewer U.S. dollars and increasing their holdings of other currencies, such as the euro, yen, British pound, or new alternatives such as the Chinese yuan. While the yuan's share remains small (about 2.2%), it has grown, especially among countries like Russia. Using alternative currencies in trade: Countries are entering into bilateral or regional agreements to conduct trade in their own currencies rather than using the dollar as an intermediary. For example, China has introduced yuan-denominated oil futures (the "petroyuan") to challenge the petrodollar system. Increasing gold reserves: Many countries, including China, Russia and India, have significantly increased their purchases of gold as a safer reserve asset, reducing their dollar holdings. Developing alternative financial systems: Some countries and blocs, such as BRICS, are working to develop alternatives to the US-dominated SWIFT payment system to avoid the risk of sanctions and gain true economic and political independence. Reasons for de-dollarization The move towards de-dollarization is driven by geopolitical and economic factors: Backlash against US economic hegemony: The US often uses dollar dominance to impose sanctions and exert political pressure, encouraging countries to seek financial sovereignty. Rise of new economic powers: Emerging economies like China and groups like the BRICS are seeking to reduce their vulnerability to U.S. influence and promote regional integration and alternative financial infrastructures. Geopolitical tensions: Conflicts like the war in Ukraine have intensified efforts by countries like Russia to remove the dollar from their reserves to avoid sanctions. Implications and outlook While the dollar remains dominant, a more de-dollarized world is already changing global economic power. The U.S. may lose some advantages, such as lower borrowing costs and geopolitical influence. For the U.S. economy, de-dollarization could lead to a weaker currency, higher interest rates, and reduced foreign investment, although some effects, such as inflation from a weaker dollar, could belimited . For other countries, de-dollarization could mean greater economic independence and less exposure to U.S. policy risks. However, no currency currently matches the dollar’s ​​liquidity, stability, and global recognition, so a full transition is unlikely in the near future . Summary De-dollarization is a complex, ongoing process that reflects a gradual shift away from the global dominance of the U.S. dollar. It involves diversifying reserves, using alternative currencies and assets, and creating new financial systems to reduce dependence on the dollar. Driven by geopolitical tensions and the rise of emerging economic powers, de-dollarization challenges the entrenched role of the dollar but is unlikely to completely replace it anytime soon. Instead, it is leading to a more multipolar monetary system in international finance, increasing demand for alternative investments to the U.S. Technical task The main technical chart is presented in a quarterly breakdown, reflecting the dynamics of the Canadian dollar against the US dollar FX_IDC:CADUSD in the long term. With the continued positive momentum of the relative strength indicator RSI(14), flat support near the level of 0.70 and a decreasing resistance level (descending top/ flat bottom) in case of a breakout represent the possibility of price growth to 0.80, with the prospect of parity in the currency pair and strengthening of the Canadian dollar to all-time highs, in the horizon of the next five years. -- Best wishes, Your Beloved @PandorraResearch Team 😎
by PandorraResearch
$DXY bullish from 96-98, massive bull flagDespite everyone calling for the death of the dollar, I think the dollar is in the process of bottoming and then will head higher. Macron called for the Euro to replace the dollar (which is laughable) and likely marks a bottom. Either we bounce here, or I could see the possibility of one more spike low down to the ~96 support level, but should we see a reaction there, it sets up a massive move higher in the dollar. As you can see on the chart, we've been correcting inside of a bull flag, if we can form a low around $96-98, we will reverse and head higher to break the flag to the upside. Upside targets on the chart. I think the bull market in the dollar is just starting, don't let the news scare you out of accumulating dollars over other fiat currencies.
TVC:DXYLong
by benjihyam
EURUSDHello Traders! 👋 What are your thoughts on EURUSD? After a strong bullish rally that led to a breakout above the 1.12 resistance zone, EURUSD is now undergoing a correction. We expect the price to pull back toward the identified support zone, where it may find demand and begin a new bullish wave. As long as the price holds above the specified support zone and the ascending trendline, our outlook remains bullish. A successful retest of support could pave the way for the next leg higher. Will the pullback offer a buying opportunity, or is a deeper correction ahead? Share your thoughts below! Don’t forget to like and share your thoughts in the comments! ❤️
Long
by HAMED_AZ
18
USDCHF BULLISH OR BEARISH DETAILED ANALYSISWe are currently observing the USD/CHF pair, which is trading around 0.8225 as of April 23, 2025. The pair has recently experienced a slight uptick, driven by renewed demand for the US dollar following President Trump's decision to retract threats against Federal Reserve Chair Jerome Powell. This move has alleviated investor concerns regarding the Fed's independence, providing a temporary boost to the greenback. Despite this short-term rally, the overall outlook for USD/CHF remains bearish. The pair is trading below the critical 100-day Exponential Moving Average (EMA), and the Relative Strength Index (RSI) is hovering near 36, indicating continued selling pressure. The immediate resistance level is identified at 0.8360, while the first support level to monitor is at 0.8121. Fundamentally, the Swiss franc has appreciated significantly, surging approximately 9% against the US dollar in April alone. This appreciation is attributed to global uncertainties stemming from shifting US trade policies, which have increased demand for safe-haven assets like the franc. The Swiss National Bank (SNB) is under pressure to address this rapid rise, as it poses risks to their inflation targets and the competitiveness of Swiss exports. In conclusion, while there may be short-term fluctuations influenced by geopolitical developments and central bank communications, the prevailing trend for USD/CHF appears bearish. Traders should remain cautious and monitor key support and resistance levels, as well as fundamental factors that could impact the pair's trajectory.
Long
by AndrewsMarket-Mastery
1
+300/+500 pips EURJPY Swing Trade Setup H4 TF🏆 EURJPY Market Update H4 chart 📊 Technical Outlook 🔸trading in well defined range 🔸Short-term: BULLS final pump 🔸Mid-term: BEARS 158.00 🔸Status: REVERSAL from S/R 🔸163.50/165.00 heavy resistances 🔸158.00/156.00 key s/r zones below 🔸Price Target Bears: 158 🔸Price Target BULLS: 1140/1160 🔸strategy: SHORT SELL 163.50 🔸SL 75 pips TP1 +300 pips TP2 +500 pips 🔸swing trade setup for patient traders 📊 Forex Market Update (April 23, 2025) 🇪🇺 EUR/USD 📉 Price: ~1.1380 💪 Pressure from strong USD 🔻 Weak German PMI; ECB may cut rates ⚠️ Key Levels: Support 1.1300 | Resistance 1.1400 🇬🇧 GBP/USD 📉 Price: ~1.3300 (Down from 7-month high at 1.3424) 🇺🇸 USD rebound on Trump's comments 🏦 Market cautious on BoE policy ⚠️ Key Levels: Support 1.3280 | Resistance 1.3420 🇺🇸 DXY (US Dollar Index) 📈 Price: 99.18 (Recovering from recent low 97.92) 🗣️ Boosted by Trump reassurance on Fed leadership ⚠️ Remains pressured by trade tensions & Fed concerns 📌 Key Levels: Support 95, 90 | Resistance 101, 107 🔔 Market Volatility Alert: Watch for geopolitical updates & central bank news closely!
Short
by ProjectSyndicate
20
BTC on high time frame "Hello traders, focusing on BTC on high time frames, the price is currently in a bearish trend on the weekly chart but is indicating potential movement towards $92,000 for the next scenario. Depending on your strategy as either a holder or trader, consider your approach for the short or long term. In my view, $78,000 appears to be a favorable zone for buying." If you need further assistance or have any specific questions, feel free to let me know!
COINBASE:BTCUSDLong
by somayehbasiri
BTCUSD Intraday Move 22-04-2025📊 BTCUSD Analysis – April 22, 2025 Price action is currently forming a rising wedge, typically a bearish pattern, indicating that a short-term correction may occur before the next bullish impulse. The structure shows consolidation with weakening momentum, suggesting that a pullback to demand zones is likely. We have two strong support zones identified: Zone 1: 86,400 – 86,800 — minor support from recent consolidation. Zone 2: 84,700 – 85,100 — major demand area aligned with previous breakout and price reaction. A retracement into either of these zones offers high-probability buy opportunities for continuation toward the upper resistance trendline and prior high near 89,700. 📈 BTCUSD Buy Signal: Buy Entry #1: 86,400 – 86,800 Buy Entry #2: 84,700 – 85,100 Take Profit: 89,700 Stop Loss: For Entry 1: Below 86,200 For Entry 2: Below 84,500 Trade Idea: Wait for bullish price action (engulfing candle, pin bar, or volume spike) before entering.
COINBASE:BTCUSDLong
by QuinnReed_Charts
1
$DXY Repeating 2016 Post-Election I have highlighted the 2016 to 2020 Presidential Elections time period and then pasted that timeframe onto the 2024 election and found that the pattern is going along very similarly to Trump 1.0. If we assume that the future unfolds the same as last time, which is low probability, of course, then the future will unfold as shown in the yellow bars going into the future, as shown. Initially in 2016 post election there was a 7% rally in the U.S. Dollar Index and then a 15% retreat for the following year. So far in 2025 we have seen the same rally and a similar decline, but only faster this time. It would appear as thought the bulk majority of the declines in the TVC:DXY are over at this time with perhaps 4% further downside over the balance of the year. The Dollar Index has been useful for predicting changes in the earnings estimates for the S&P500 in the USA due to the high percentage of earnings coming back to the US for quarterly reporting. I have posted a few charts in the past which have been helpful at determining the risk in the stock market. The behavior of the global central banks has certainly had its impact on monetary aggregates and inflation. The policy response since the Covid Pandemic has been for maximum liquidity and maximum Government spending to keep the global economy afloat. The post-Covid response is now coming to a head along with new policy directives to cut wasteful Government spending and to reduce inflation (caused the Gov't spending). Global investors have flocked to the US for access to high technology stocks and have driven up the value of US assets to extreme levels compared to other markets. This adjustment phase where investors remove money from overvalued, or highly valued, US assets back to other markets has created a wave of selling in the US Dollar and US listed equities. What does the future hold? We never know but we sure can learn from what happened in the past by looking at charts just like this one to see what may happen. Looks like a bounce in the TVC:DXY from here, followed by a new low and then a rebound into the next few years. All the best, Tim April 22, 2025 1:16PM EST TVC:DXY 98.78 last
TVC:DXYShort
by timwest
5
DXY Bearish Pennant Breakdown | More Downside Ahead?The U.S. Dollar Index (DXY) has broken down from a well-defined bearish pennant pattern on the 4H chart, signaling continuation of the prevailing downtrend. 🔹 Technical Setup: Pattern: Bearish Pennant Breakdown Level: Below 99.00 Target: ~94.50 based on pennant pole projection Confirmation: Clear follow-through after breakdown, low volume consolidation 🔹 Fundamentals: Weak U.S. economic data and dovish Fed expectations continue to weigh on the dollar. Rising gold and commodity prices further support DXY downside. 📌 Outlook: As long as DXY trades below 99.00 resistance, bearish momentum is likely to extend toward the 94.50 target zone. NOTE: This is not financial advice. Trade at your own risk. Always do your own research.
TVC:DXYShort
by Hellena_Fx
Dollar Milkshake Theory: Will the US Dollar Suck the World Dry?Imagine a colossal milkshake party where every country brings its own flavor—sweet euros, tangy yen, spicy rupees—blended into a global liquidity shake. Now picture the United States, armed with a giant straw, slurping up every last drop while the rest of the world watches in dismay. 🍓🍫🍦 This vivid analogy isn’t just a quirky dessert dream—it’s the heart of Brent Johnson’s Dollar Milkshake Theory, a provocative economic idea that’s been shaking up financial circles since 2018. But is the US dollar really about to dominate the global economy, or will it choke on its own straw? Let’s dive into this creamy concoction of macroeconomics, recent trends, and global stakes—complete with a cherry of skepticism on top! 🍒 🥛 What’s the Dollar Milkshake Theory, Anyway? Brent Johnson, CEO of Santiago Capital, isn’t just a wealth manager—he’s a financial storyteller who’s been stirring the pot with his Dollar Milkshake Theory. Picture this: the global economy is a giant milkshake, with frothy assets (stocks, bonds, commodities) floating on top, and the milk, cream, and sugar representing the cash flows between markets. The straw? That’s the US Federal Reserve’s monetary policy, sucking up liquidity when it tightens, leaving other economies parched. Johnson’s core idea is simple yet bold: during global economic turmoil, the US dollar—thanks to its status as the world’s reserve currency—becomes a safe haven. Investors worldwide flock to it, driving its value skyward while other currencies wither. 🌎💰 Since 2008, global central banks have pumped roughly $30 trillion in liquidity into the system through quantitative easing (QE), creating a massive “milkshake” of money. But when the Fed raises rates, as it has in recent years, the US siphons that liquidity, leaving other nations scrambling to pay dollar-denominated debts. Here’s the kicker: this isn’t a one-time sip. Johnson predicts a feedback loop where the dollar’s strength forces other countries to print more of their own currencies to buy dollars, further weakening their economies and reinforcing the dollar’s dominance. It’s a vicious cycle—a “milkshake” that could leave the global economy in a sticky mess. 🌀 📈 The Recipe for Dollar Dominance: Why the US Holds the Straw Why does the US get to drink everyone else’s milkshake? It’s all about structural advantages baked into the global financial system: Reserve Currency Status 💵: The US dollar has been the world’s reserve currency since the 1944 Bretton Woods Agreement. As of 2022, it accounted for 58% of global foreign exchange reserves, dwarfing the euro’s 20% share . From oil to copper, most global trade is priced in dollars, creating constant demand. Deep Capital Markets 🏦: The US has the deepest and most liquid bond markets, especially for Treasuries, making it the go-to place for investors seeking safety during crises. Higher Interest Rates 📊: When the Fed raises rates, as it did aggressively in 2022-2023 to combat inflation, the dollar becomes more attractive compared to currencies like the euro or yen, where central banks like the ECB and BOJ have been slower to tighten . Global Dependence on Dollars 🌐: Over 60% of international reserves are in dollars, and many countries and corporations hold dollar-denominated debt. When the dollar strengthens, their debt burden skyrockets, forcing them to buy more dollars to service it . Johnson argues this isn’t just a cyclical trend—it’s a structural feature of the modern financial system. As he put it on Real Vision in 2018, “The dollar’s dominance is structural, not cyclical”. The US doesn’t just sip the milkshake—it guzzles it, leaving others to scrape the bottom of the glass. 🥤 📅 2025 Reality Check: Is the Milkshake Theory Playing Out? Fast forward to April 2025, and the global economy is a blender of chaos: trade tensions, high debt levels, and monetary policy shifts are whipping up a storm. Does Johnson’s theory hold water—or rather, milk? Let’s look at the evidence. 🕵️‍♂️ 🟢 The Bull Case: The Dollar’s Straw Is Sucking Hard DXY Strength in 2024-2025: The US dollar index (DXY) surged 7% in 2024, hitting a two-year high of 108.07 in November 2024, driven by US economic growth, tariffs, and global uncertainty . Despite a recent 8% drop over the last two months (from ~106.8 in mid-February 2025 to 98.423 as of April 22, 2025), the DXY remains near historic highs, aligning with Johnson’s prediction of dollar strength during stress. Historical Precedents: During the 2020 COVID crisis, the DXY jumped as the Fed provided $450 billion in swap lines to ease dollar shortages globally, reinforcing the dollar’s safe-haven role. In 2022, Russia’s invasion of Ukraine pushed the DXY to a 20-year high of 114, as capital fled to the US amid Europe’s energy crisis. Global Liquidity Squeeze: High-debt economies like Japan (debt-to-GDP at 255%) and the Eurozone (Italy at 139%, France at 112%) are under pressure. Capital flight to the US, especially if their growth falters, supports the milkshake effect. Safe-Haven Demand: Posts on X reflect sentiment that the dollar’s strength is tied to its stability in an unstable world, with some users noting its “dug-in” status as global liquidity flows to the US . 🔴 The Bear Case: Is the Straw Starting to Bend? Recent DXY Drop: The 8% decline in the DXY over the last two months (mid-February to April 2025) signals vulnerability. Trade war fears, threats to Fed independence, and a weakening US trade balance are weighing on the dollar. Some X users predict a further drop to 96-97, or even 87, if support levels break. Fed Policy Shifts: The Fed began cutting rates in September 2024, which typically weakens the dollar by reducing its yield advantage. This move, aimed at balancing inflation and growth, could undermine the milkshake effect if it continues. Dedollarization Efforts: BRICS nations are pushing to reduce dollar reliance, with China and India holding significant non-dollar reserves ($3,682 billion and $662 billion, respectively, as of April 2025). A shift toward commodity-based currencies could challenge the dollar long-term. US Debt Concerns: The US’s soaring debt levels (over 120% of GDP in 2024) and inflation above the Fed’s 2% target raise questions about the dollar’s sustainability. If confidence in US fiscal health wanes, the milkshake could spill. 🌪️ What Happens If the Milkshake Theory Plays Out? If Johnson is right, the global economy could face a bitter aftertaste. Here’s what a super-strong dollar might mean: Currency Crises Abroad 💥: Countries with dollar-denominated debt—like many emerging markets—would struggle as their debt burdens soar. A stronger dollar means they need more of their own currency to buy dollars, potentially triggering defaults. Commodity Price Slumps 📉: A rising dollar often leads to lower commodity prices (priced in dollars), hurting exporters like Brazil or Australia. This could stifle growth in developing economies. US Export Woes 🚢: An overly strong dollar makes US goods pricier abroad, hurting American exporters. US companies could lose competitiveness, impacting economic growth. Safe-Haven Asset Boom 🪙: Investors might flock to alternatives like gold or Bitcoin to hedge against currency devaluation. Gold recently hit $3,400 amid the DXY’s slide, and Bitcoin has seen gains as a “risk-on” asset. Geopolitical Shifts 🌍: A dominant dollar could lead more countries to peg their currencies to the USD for stability, as 65 nations already do (e.g., Hong Kong, Saudi Arabia). But it might also accelerate dedollarization efforts, with BRICS nations seeking alternatives. 🤔 Skeptics Stir the Pot : Is the Milkshake Theory Too Sweet to Be True? Not everyone’s sipping Johnson’s milkshake. Critics argue it’s more of a financial fairy tale than a robust theory: Oversimplification 📊: The global economy is far more complex than a milkshake analogy. The theory focuses heavily on Fed policy but downplays other central banks’ actions, geopolitical tensions, and the rise of digital currencies. Lack of Timeframes ⏳: Johnson’s predictions lack clear timelines, making them hard to test. As some X users have pointed out, being “too early” in financial markets is as good as being wrong. Counter-Theories 🌐: Economist Zoltan Pozsar’s Bretton Woods III Theory suggests a shift toward commodity-based currencies in the East, potentially weakening the dollar. Post-Russia-Ukraine war, nations are diversifying away from the USD, favoring hard assets like gold. US Vulnerabilities 🇺🇸 : The US’s own fiscal health—high debt, persistent inflation, and trade deficits—could undermine the dollar. Recent tariffs and supply chain shifts (e.g., moving away from China) may raise production costs, fueling inflation and slowing growth. 💡 What’s Next for the Dollar Milkshake in 2025 and Beyond? As of April 22, 2025, the DXY’s recent 8% drop is a speed bump, not a derailment, for the Milkshake Theory. The long-term chart you provided projects the DXY climbing to 120-130 by the late 2020s, suggesting this dip might be a correction within a broader uptrend. But the road ahead is frothy with uncertainty: Watch the Fed 🏛️: If the Fed continues rate cuts, the dollar’s yield advantage could shrink, slowing the milkshake effect. Conversely, renewed tightening could reignite dollar strength. Global Crises ⚡: Ongoing trade wars, like US-China tensions, or new geopolitical shocks could drive more capital to the US, reinforcing the theory. Dedollarization Risks 🌏: If BRICS nations succeed in reducing dollar reliance, the US straw might not suck as hard in the future. 🥛 Sip or Spill: Should You Buy Into the Milkshake Theory? Brent Johnson’s Dollar Milkshake Theory is a compelling narrative that captures the US dollar’s unique power in a turbulent world. The evidence—DXY strength, historical crises, and global dollar demand—suggests there’s cream in this shake. But the theory isn’t without cracks: the US’s own vulnerabilities, dedollarization efforts, and the recent DXY dip remind us that even the mightiest straw can bend. 🥤 For investors, this means staying nimble. A stronger dollar could hurt emerging markets and commodities, but it might boost safe-haven assets like gold or Bitcoin. Keep an eye on Fed policy, global growth, and geopolitical shifts—they’ll determine whether the US keeps sipping or the milkshake spills. 🌍💸 What do you think—will the dollar dominate, or is the party over? Let’s hear your thoughts! 🗣️
TVC:DXYLong
by RoadToAMillionClub
USD/CAD - Channel Pattern (22.04.2025)The USD/CAD Pair on the M30 timeframe presents a Potential Selling Opportunity due to a recent Formation of a Channel Pattern. This suggests a shift in momentum towards the downside in the coming hours. Possible Short Trade: Entry: Consider Entering A Short Position around Trendline Of The Pattern. Target Levels: 1st Support – 1.3771 2nd Support – 1.3745 🎁 Please hit the like button and 🎁 Leave a comment to support for My Post ! Your likes and comments are incredibly motivating and will encourage me to share more analysis with you. Best Regards, KABHI_TA_TRADING Thank you.
Short
by KABHI_TA_TRADING
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