Published: 25 February 2026,07:21
Daily Market Analysis New
*Stronger US consumer confidence and cautious Fed rhetoric are providing near-term support for the dollar.
*Federal Reserve officials signaling patience on rate cuts are helping anchor US yields and underpin the greenback.
*Ongoing tariff uncertainty under Donald Trump is injecting volatility and capping sustained USD upside.
Market Summary:
The US dollar is trading with a mildly firmer tone in the very near term, supported by stronger-than-expected US data and cautious Federal Reserve rhetoric, but the broader outlook remains clouded by policy uncertainty. The Conference Board’s Consumer Confidence Index surprised to the upside at 91.2 vs 87.4 expected, helping the US Dollar Index (DXY) edge back toward the 97.8–97.9 area. This improvement in household sentiment reinforces the narrative that US domestic demand remains resilient, giving the greenback a short-term bid.
At the same time, several Federal Reserve officials have leaned hawkish-neutral, pushing back against expectations for imminent rate cuts. Fed Governor Christopher Waller signaled openness to keeping rates unchanged in March if the labour market stabilizes, while Boston Fed President Susan Collins said policy may need to stay restrictive “for some time.” This rhetoric has tempered aggressive easing bets, even though markets still price roughly three 25-bp cuts in 2026, according to CME FedWatch. Higher-for-longer rate expectations continue to provide underlying yield support for the dollar.
However, the dollar’s upside is being capped by significant policy and trade uncertainty. US President Donald Trump has warned trading partners against backing away from recent agreements after the US Supreme Court struck down his emergency tariffs. Washington has begun implementing a 10% global tariff while simultaneously signaling plans to lift it to 15%, creating confusion around US trade policy. Historically, erratic tariff developments tend to inject volatility into FX markets and can undermine sustained USD rallies if they begin to threaten global growth.
Cross-asset flows also paint a mixed picture. While the dollar benefited from intermittent safe-haven demand during Wall Street weakness, risk sentiment remains fragile amid AI-related equity concerns and geopolitical tensions with Iran. If equity volatility deepens or growth fears intensify, the dollar could face competing forces: safe-haven inflows on one side versus rate-cut repricing and trade headwinds on the other. Overall, the USD bias is near-term supported but medium-term direction remains highly data- and policy-dependent.
Technical Analysis
The U.S. Dollar Index is trading within a well-defined range structure, bounded by resistance near 98.00 and support around 97.00, with a deeper floor at 95.75. Price recently rebounded from the 97.00 support zone and pushed back toward the upper boundary near 98.00, but the latest candles show hesitation just beneath resistance, suggesting buyers are struggling to generate a decisive breakout. Structurally, the index has been forming higher lows since the mid-month bottom near 95.75, indicating short-term recovery momentum. However, price remains capped below 98.00, keeping the broader move corrective rather than impulsively bullish. A clean break and sustained close above 98.00 would open the path toward the 98.70 region, while rejection at current levels could send price back toward 97.00 to retest range support.
Momentum indicators reflect this consolidation tone. RSI is hovering around the mid-50s, signaling neutral-to-mild bullish momentum but not overbought conditions. The indicator has cooled from previous highs and is flattening, which aligns with the current sideways price action. Meanwhile, MACD remains slightly positive but is converging near the signal line, with histogram bars shrinking, another sign that upside momentum is fading rather than accelerating. Overall, the Dollar Index on the chart is consolidating near range highs.
Resistance Levels: 98.00, 98.70
Support Levels: 97.00, 95.75
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