In this video: IS THE COLLAPSE STARTING? Gold Surges as the Dollar Hits a 15-Year Breakdown Zone. Video by Gareth Soloway.
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The U.S. Dollar Index (DXY) has recently entered a critical 15-year breakdown zone, testing support levels that have largely held since the 2008 financial crisis. This technical shift follows a period of extreme overvaluation at the start of 2025 and a subsequent sharp decline.
Key factors and levels currently defining this breakdown include:
-Critical Support Levels: The DXY is testing a long-term support line dating back to 2008 lows. Technical analysts have identified the 95 level as a vital threshold; a sustained break below this could trigger a move toward the 89–90 range, which acted as support in early 2021.
-Recent Performance: The dollar hit a four-year low in January 2026, dropping to roughly 95.86. This follows its worst start to a year since 1973, with a double-digit decline in the first half of 2025.
-Geopolitical and Macro Drivers:
---Policy Uncertainty: Unpredictable U.S. moves, such as renewed tariff threats against European and North American allies and unorthodox proposals like the acquisition of Greenland, have eroded the "safe-haven" trust in the dollar.
---Monetary Divergence: While the Federal Reserve has faced pressure to cut rates (recently implementing a 25bps cut), other global central banks have maintained tighter policies, reducing the dollar's yield advantage.
---Political Commentary: President Donald Trump has publicly characterized the dollar as "too strong," arguing it makes U.S. companies less competitive—a departure from decades of "strong dollar" rhetoric.
-Asset Rotation: Investors are increasingly shifting capital toward hard assets like gold and silver, which have surged to record highs as the "debasement trade" gains momentum.
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