The dollar has been wreaking havoc, bringing a critical level back into play.
After last weekend’s events, we got the classic kneejerk: oil and the dollar spiked, while risk assets sold off. A flight to safety. Sell everything, bid dollars.
Energy is the obvious trade and needs no explanation. Supply disruptions both real and perceived, fear, and mispositioning.
The bigger question is the dollar. A stronger greenback is the quickest way to put pressure on what has been one of the strongest themes of this cycle: international equities.
Our warnings last week were timely. And what we’ve seen since isn’t an orderly pullback. The speed and the volatility scream panic.
But we have to stay objective. Price, not headlines, is our style.
We’re now approaching the line in the sand. The most important level in the market.
The 100–101 zone in the US Dollar Index is the level that matters. The market has flagged it as structurally important again and again. Above it, we enter the pain zone. Ex-US equities likely take the brunt, but US stocks won’t be immune either.
The reclaim of 98 was the first signal this countertrend rally was real.
Volatility across both emerging and developed markets has already spiked to its highest levels since the April 2025 lows.
This is washout behavior. A lot of damage was done quickly, and latecomers got punished.
Right now, it would be irresponsible to call for a bottom without the evidence supporting it.
If DXY fails at 100–101 and rolls back over, and volatility in EM and DM equities starts to cool, we may be looking at a high-quality dip-buying opportunity. But we have to wait for the test and see how the dollar reacts at this big level.
The primary trend suggests the short US dollar trade probably has legs over the long run. But patience remains the best course of action for now.
So we do what we always do. We go back to the charts, manage risk, and let the market confirm the next move.
DXY back in the 100s will mean a longer and deeper corrective wave. On the other hand, a quick rejection at this level will bring out the dip buying for global equities and risk assets more broadly, and we’re probably back at new highs soon.
This remains a fast market. Steve just showed exactly how he targets quick doubles and multi-baggers on the most liquid stocks in the market — in both directions. The full session is on replay.
