In January 2025, Adam Turnquist created a chart. The chief technical strategist at LPL Financial had overlaid the U.S. Dollar Index's trajectory across both of Donald Trump's presidential terms — a straightforward comparison to gauge how the second term was tracking against the first. The index, which measures the dollar against a basket of six major trading-partner currencies, is the most widely used benchmark for the greenback's broad strength. He has updated the chart every couple of months since, each time sharing it with his head of macro research accompanied by the same running joke: why do we even try to forecast?

"It's the exact same pattern," he told Fortune. "Last week, I started refreshing data, and here it is."

The pattern carries weight because of what it signals about the dollar's current position. After declining 13% over 269 trading days from its January 2025 peak, the Dollar Index has broken out above resistance near the 100 level — mirroring the same stage-three move that followed the dollar's bottom during Trump's first term in early 2018. If that precedent holds, Turnquist believes the dollar could be entering another sustained climb.

Two Terms, One Script

The symmetry in the chart is striking enough to be almost unsettling. "The dollar has tracked so closely, not only in the magnitude but the duration of the moves," he said.

Following Trump's 2016 victory, the Dollar Index rallied approximately 8% to a January 2017 peak, then reversed sharply — falling roughly 15% over 293 trading days before bottoming in early 2018. From there, it mounted a 17% ascent to a 2020 high, a run halted only by the arrival of the pandemic.

The 2024 election produced a near-identical replay: a rally to a January 2025 peak, a 13% decline over 269 trading days, and a bottom in early 2026. The percentages, trading-day counts, and overall shape are close enough that Turnquist continues making the same joke.

Yet he is also the first to acknowledge that the pattern defies easy explanation. The macroeconomic backdrops share little in common. The 2016 reflation trade was fueled by an accommodative Federal Reserve and inflation running well below target — conditions with no parallel in the current cycle, where the Fed continues to grapple with an inflation rate that refuses to return to 2%. The only macro overlap Turnquist can identify is elevated oil prices. Everything else has shifted.

So if the conditions differ, what is producing the same script?

One possibility Turnquist explored was deliberate intent on Trump's part. He dismissed it quickly. "We haven't heard him talk about the dollar lately," he said. The more compelling explanation is structural.

"Initial excitement of Trump's policies being implemented, the big reflation trade in 2016, then reality sets in — it takes a while for policy to set in with growth, the trade fizzled out a little bit, then rebounds in a pretty material way," he said. Both terms traced that arc. Interest rates played a role in both cycles as well, Turnquist acknowledged — "part of it is where interest rates are" — but the dominant force, in his assessment, was growth expectations rather than yield differentials.

His reasoning has two layers. The first centers on policy sentiment. "Taking politics out of it," he said, "the policy initiatives are clearly pro-growth — lower taxes, more incentives for corporate America, incentives for companies to invest and bring back manufacturing. All of those factors are catalysts for growth, especially with all the curveballs we've faced." In both terms, the election sparked the same initial wager on American reflation, producing the same initial rally — and in both terms, that bet collided with the same friction of reality, triggering the reversal.

Beneath the policy layer, however, he perceives something more enduring: the dollar as a barometer of relative economic strength. Before the Covid pandemic reached American shores in 2020, the U.S. economy had consistently surprised throughout Trump's first term with solid job growth, low interest rates, and a robust stock market.

"When the U.S. economy is outperforming other economies, the dollar tends to strengthen," he said. "In a simple way, that's what this chart is — a testament to the U.S. economy."

That dynamic is amplified in the current cycle because of where the outperformance is concentrated. Foreign investors seeking exposure to the AI trade — to the hyperscalers, the semiconductor companies — must sell their local currencies to purchase dollar-denominated assets. That steady stream of currency conversions creates a structural bid for the dollar, one driven less by White House policy and more by the geography of the technology revolution. The U.S. equity market's outsized weighting in technology — the so-called Magnificent Seven alone account for roughly a third of the S&P 500's market capitalization — means global capital flows are disproportionately channeled through dollar-denominated instruments.

"You look at the AI trade, you look at the tech names and you want to own that," Turnquist said. "You sell your local currency to go fund dollar purchases of one of the hyperscalers or one of the semiconductor companies."

The Biden Counterfactual

The Trump-era symmetry appears even more pronounced when contrasted with the dollar's trajectory under Joe Biden, which followed an entirely different shape. The Dollar Index began Biden's term near 90 in January 2021 — after dipping to its lowest level since 2018 — and had climbed to approximately 108 by the time he left office in January 2025, representing a gain of well over 15% and one of the stronger full-term performances for the currency in decades. The drivers, however, bore no resemblance to the Trump-era pattern: the dollar surged as the Fed launched an aggressive rate-hiking cycle to combat the largest inflation surge in four decades, pushing the index above 110 by 2022.

That contrast cuts to the core of the question. Biden's dollar story was fundamentally a Fed-and-inflation narrative — rate differentials doing the heavy lifting. Trump's two terms, by comparison, display a distinct election-cycle pattern: an initial sentiment-driven rally, a reversal as reflation hopes meet reality, and then a rebound tied to actual economic outperformance. The distinction is between a currency shaped by monetary policy versus one driven by shifting wagers on relative growth and American exceptionalism — a term widely used in financial markets to describe the persistent outperformance of U.S. growth, asset valuations, and innovation capacity relative to other developed economies.

Some critics have highlighted a roughly 16% erosion in the dollar's purchasing power under Biden due to high inflation — a different metric than the index's point gains, but a reminder that a strengthening DXY and a weakening consumer dollar can coexist. Purchasing power has continued to decline under Trump's second term, albeit more modestly, as the inflation rate persists above the Fed's 2% target, with some observers expecting it to reach 4%.

How Long Will the Dollar Stay Strong?

Turnquist has little patience for the reserve-currency displacement narrative that resurfaces each time the dollar sells off. The scenario demands not merely a competing currency but a Treasury-scale liquid market — something he does not see materializing. The U.S. Treasury market, at roughly $29 trillion in outstanding marketable debt, is the deepest and most liquid sovereign bond market in the world, a structural advantage no alternative has come close to matching.

"It's not like you can go trade in yuan or the euro or crypto or whatever." China, he noted, has made repeated efforts to promote yuan-based settlement with limited success. "They've tried and tried and tried, and you can't trade in yuan."

He draws a distinction between diversification and abandonment. "There's been a diversification away from the dollar, and that's what central banks have done," he said. "But there hasn't been a boycott in any material way that suggests it's the end of the dollar."

The data supports his view: approximately 90% of foreign-exchange transactions involve the dollar, with gold, Treasuries, and the euro trailing significantly behind as alternatives. Any genuine shift in reserve status, he contends, would require both a competing currency and a Treasury-scale liquid market — conditions he does not foresee materializing in the near term.

"Maybe in my lifetime" the dollar will be displaced as the international reserve currency, he said, while searching his office for a book on monetary history.

"At some point it will happen," he acknowledged, observing that different regimes have cycled through, "probably for thousands of years." Pointing to the mounting challenge of the $39 trillion-plus national debt, he added, "you look at our fiscal responsibility — if you can use that word — the deficit, if that continues, then, yeah, at some point people will be worried about owning the dollar, owning Treasuries." Still, he stressed that a great deal would need to change for the dollar to be displaced. "Certainly not this year or next year," he added.

A Country Divided, but Still Spending

Perhaps the most revealing element of Turnquist's analysis comes from consumer sentiment data. Conference Board confidence figures have displayed a sharply polarized divide throughout 2026 — Republicans reporting a healthy economy, Democrats describing a dire one, with the gap at extremes he has not previously witnessed. This partisan divergence in economic sentiment is not unique to the current moment; researchers at the University of Michigan and the Brookings Institution have documented a growing gap between Republican and Democratic economic perceptions stretching back to at least 2017, with the party occupying the White House consistently reporting more favorable views regardless of underlying conditions.

"There's always a divide," he said, "but it's at extremes right now."

Yet when looking past survey responses to actual behavior, the narrative shifts. "Actions speak louder than words," Turnquist said. Spending data indicates that consumers and companies continue to invest and spend despite the political divide in economic perception.

That gap between rhetoric and reality may offer another explanation for the chart: a currency market that, amid all the noise around tariffs, disputes over Fed independence, and predictions of reserve-currency decline, continues to track the same fundamental signal it always has — where capital believes growth is strongest. Turnquist himself expressed surprise at how closely the pattern has held.

"What it boils down to this time and probably the previous episode," Turnquist said, "is the dollar is the gauge of relative economic strength." The chart, for now, continues to follow the script of "the American exceptionalism theme."

This story was originally featured on Fortune.com.