DXY is framed as near a low and likely to rally if the Fed hikes before year-end, with 60% odds for a September 9 rate hike and a move back toward 104-105 into 2027-2028. The core thesis is that the dollar is repeating a pattern seen in prior cycles: low, rally, pullback, then a stronger advance once hikes resume, with the first-term Trump analog and the 1990s hike/pause/cut/hike sequence both used as support. A break below all recent lows would force reassessment. Gold weakness is tied to that expected dollar rise, while Bitcoin dominance is cited only as a caution that excluding stablecoins changes the read materially.
As of September 9, rate-hike odds were 60%; a hike before year-end, possibly as early as September, stays the base case.
A Fed unwilling to raise rates would change the DXY view; a hike would likely push the dollar back up and trigger a bounce.
DXY at recording was around 98, though the exact release-date level was unknown because the video was pre-recorded while traveling.
DXY is expected to repeat a pattern of making a low, rallying, pulling back, then moving higher; the current path is expected to rhyme with prior lows.
Trump’s first-term dollar path is used as a template: down for the first year, then consolidate, then head back up.
In Trump’s first term, DXY started going up on day 608 after a drop around day 597 indexed to the new administration in 2018, and it kept rising into year-end.
Late 2018 is rejected as the best analog; the better comparison is a rate-hiking cycle, then a pause, then a rate-cutting cycle, then another rate hike.
The 1990s analog showed DXY around 90-91 before the hike, then about 97 roughly a month later, and it kept rising until the Fed cut rates again.
DXY is expected to find a low soon, move up into the rate hike, likely keep rising until the Fed cuts rates again, then return to the trend line.
DXY is expected to revisit about 104-105, possibly in 2027 or 2028.
If DXY takes out all recent lows, the thesis needs reassessment.
Bitcoin dominance is used as an analogy, but excluding stablecoins changes the chart materially; with stablecoins excluded, the pattern looked more like a higher low than lower lows.
Gold is already moving down to find a low, possibly a higher low, with the recent weakness attributed to the coming dollar rise.