The US dollar is under pressure and continues to decline, with bearish market sentiment difficult to reverse.

According to Jin10 Finance, despite signals of resilience in the U.S. labor market—which theoretically should support Federal Reserve policies—the U.S. dollar index continues to weaken. This contrast indicates that market bearish sentiment toward the dollar has become deeply rooted, enough to offset expectations of strong economic data. Corpay’s strategic analysis team pointed out that this bearish atmosphere serves as a warning to market participants who rely on the strength of U.S. fundamentals for support.

Strong Non-Farm Payrolls Can’t Mask Bearish Expectations

Optimistic data signals have failed to change the market’s negative sentiment. The bearish pressure on the dollar has become an overwhelming factor, making it difficult for a healthy employment market to reverse this trend. This reflects that the market has already priced in the expectation that the Federal Reserve may maintain its policies unchanged for a long time, which in turn reinforces bearish attitudes toward the dollar.

Historical Comparison Shows: The Dollar Still Has Downside Potential

From a historical perspective, the current decline of the dollar is still moderate. If bearish sentiment persists without any substantial change, the dollar may continue to decline. This means that any short-term adjustments in market views could trigger larger fluctuations in the dollar, and currently, the bearish camp holds the narrative, creating conditions for further downward pressure on the dollar.