DOLLAR INDEX SHORT TERM BEARISH?US Dollar IndexTHINKMARKETS:USDINDEXJunmadayagThe US Dollar Index (DXY) is under short-term downward pressure following the July 2025 CPI data released on August 12, which showed a year-on-year inflation rate of 2.7%, slightly below the expected 2.8%, and a core CPI of 3.1%. This reinforces market expectations of a Federal Reserve rate cut in September, with an 80-90% probability, weakening the dollar’s yield appeal. Trading near 98.5, close to a three-year low, the DXY faces technical support at 97.8, with a potential drop to 96.37 if breached, while resistance lies at 99.6. Despite bearish sentiment driven by a dovish Fed outlook and tariff uncertainties, resilient US economic growth (2.7% in 2024) and higher Treasury yields (4.4%) compared to peers could support a dollar rebound if upcoming data, such as jobs or PCE inflation, surprises hawkishly. Over the next 1-3 months, the DXY is likely to consolidate between 97.5 and 100, with risks tilted toward weakness unless offset by stronger economic indicators or geopolitical tensions boosting safe-haven demand. Currently we are at a short-term support and if broken could be a trigger for short expansion. What's your thoughts?