The U.S. dollar surged to its highest level in years in 2016, but Todd Gordon of TradingAnalysis.com believes the greenback rally could be on its last legs.
"The dollar's had an amazing run to the top side on the back of the Fed beginning to normalize interest rates," Gordon said Monday on CNBC's "Trading Nation." "But we're starting to see evidence that that run is getting tired."
After a big rate rally, sliding bond yields have recently put pressure on the dollar, and Gordon expects this trend to continue. From a technical standpoint, the trader believes that an intraday chart of the dollar-tracking ETF (UUP) signals that the dollar rally has run its course.
More specifically, Gordon says that while the dollar had been making "higher highs" on the way up, UUP has since made lower lows, which suggests "a change in trend."
"We've seen a bit of a snapback here in the market and I think this little pullback is an opportunity to sell near term for a continued push lower," he said.