USD weakens as global equity correction triggers risk-off sentiment

The US dollar is losing ground against major peers as a broad equity market correction shifts investor sentiment toward risk-off positioning. EUR/USD has climbed 0.4% to 1.0825, while GBP/USD advanced 0.3% to 1.2680. The S&P 500's 2.5% decline over the past week has prompted safe-haven flows, with AUD/JPY dropping 1.2% to 96.50 as yen strength emerges. EUR/SEK shows unusual volatility, trading 0.8% higher at 11.45 amid thin liquidity conditions. Dollar positioning data reveals a significant reduction in net long positions, falling to $12.3 billion from last week's $15.8 billion peak. Technical analysis indicates USD index support at 103.20, with resistance at 104.00. The shift in market dynamics suggests potential for continued dollar weakness if risk aversion persists, particularly against traditional safe havens like JPY and CHF.