Dollar’s 2026 Breakdown Looms—But Don’t Bet on a Straight Collapse

The greenback's looking shaky. Early 2026 could see the US dollar finally crack under pressure—only to stage a classic, head-faking reversal that leaves speculators reeling.

The Setup for a Fall

Mounting debt, shifting reserve flows, and that ever-present specter of inflation are lining up like dominoes. The conditions for a significant dollar downturn are crystallizing. When confidence wobbles, the floor can drop out fast.

The Inevitable Pivot

Here's where it gets interesting. Just when the 'dollar doom' narrative hits peak volume, expect the old guard to step in. Central banks have a playbook for this—liquidity injections, coordinated rhetoric, maybe a strategic rate move. The goal isn't to fix the root cause, but to engineer a rebound that 'proves' the system's resilience. It's the financial equivalent of a controlled demolition, followed by a press conference praising the building's structural integrity.

So, a breakdown? Likely. A one-way trip to zero? Never. The system's built for managed declines and engineered recoveries—it's how the big players profit from the panic of everyone else. After all, what's a currency crisis if not a wealth transfer opportunity dressed up as a macroeconomic event?

US Dollar To Break Further Down In 2026

The US dollar is in for a wild ride in 2026, as the asset is on track to experience further volatility in 2026. Experts are suggesting how massive macroeconomic developments coupled with Trump’s constant spending on One Big Beautiful Bill are set to deteriorate the dollar further. The strategists have shared how the dollar is forming a V-shaped formation, with the DXY index dropping as low as 94.

The #DXY [1W] appears poised to continue its bearish trajectory after failing to break the December 2023 low for two consecutive weeks.

The index is about to break the neckline of the big double top targeting sub 95. pic.twitter.com/V5HdxIr2cr

Reverse Is Closer Than Before

However, in addition to this, experts later added how the US dollar may reverse course in mid-2026. Experts now believe that new government spending in the second half of 2026, with trade tariffs helping inflation, may ultimately help the American currency gain secure footing.

2026 will be the year of the dollar. $DXY is pushing up against its 200dma and I believe a Supreme Court ruling against tariffs could give it the boost it needs to break out and push higher to 100 pic.twitter.com/MtVYPQQ08J

Moreover, per a Reuters report, Jane Foley of Rabobank believes the dollar may continue to decline in “choppy ranges,” resisting a sharp fall.

With major banks predicting a downward trend for the US dollar in 2026, Jane Foley of Rabobank explains why she believes the dollar may trade in choppy ranges rather than continue its sharp decline pic.twitter.com/fkrdx0g8eu