Why the Dollar Just Broke its Downtrend

Markets rarely grant the luxury of a single narrative, yet this week they tried. With one well-timed handshake Washington and Beijing yanked global risk appetite out of hibernation, forcing desks that had been building dollar shorts all year to cover in a hurry. What looks like a routine short-squeeze could morph into something bigger if policy momentum holds—and that possibility is exactly what the foreign-exchange complex is now trying to price.