Post #16095

USD Directional Call Is Tricky DXY is staying under pressure below 99 as markets balance soft core inflation against ongoing geopolitical risk. While ceasefire talks and potential negotiations are offering some relief, the situation is far from resolved — with Hormuz still restricted, keeping oil elevated. From a data standpoint, headline CPI came in hot, driven by energy, but core inflation was softer than expected. That’s the key split. Markets are reading it as no broad-based inflation problem just yet — more of an oil-driven spike. That’s weighing on the dollar. With core inflation not accelerating meaningfully, the Fed is unlikely to tighten into this environment. If anything, it keeps the door open for cuts later on, even if near-term expectations remain muted. Technically, the dollar remains weak. Unless we see a shift in inflation dynamics or a stronger risk-off bid, rallies are likely to be faded. - Alan