US Dollar Breakout- Rising Pressure on US EquitiesU.S. Dollar Currency IndexTVC:DXYArthurshAfter more than a year of consolidation (showed in white rectangle) DXY broke out above the key resistance zone market in red, and it can be bad for US equities. Main drivers of recent dollar strength are persistent inflation concerns fueled by geopolitical uncertainty, which have triggered a clear shift in Fed rate expectations. While at the start of 2026 most major institutions were pricing in one to two 25bps rate cuts over the year, those expectations are off the table. The narrative has shifted from “how many cuts” to whether the Fed may need to remain on hold for longer or even consider further tightening if inflation proves sticky. In the past few months, we’ve seen a very clear inverse relationship between the US Dollar (DXY) and US equities. A strong example was the move from January 27th to March 13th, where the DXY rallied roughly +5.2%, while the Nasdaq Composite dropped about -7.5%, reflecting clear pressure on risk assets during dollar strength. We see a similar dynamic in the more recent move starting May 12th and still ongoing. The DXY is up around +3.2%, while the Nasdaq has been essentially flat, up only about +0.3%, but with increased volatility and lack of clear directional momentum. Overall, this reinforces the idea that in the current regime, dollar strength has been acting as a headwind for US indices, especially growth-heavy sectors like tech. Looking at the chart using weekly candles, the next major obstacle for the DXY is the 200-week moving average, which should act as strong resistance. From current levels, price still has about 1.6% upside before reaching that zone. Overall, I believe the next few weeks could be highly volatile for US equities, with an increased risk of a deeper correction, particularly in heavy growth stocks.