What can support USD in near term?

Part of the answer lies in Markets' move since Friday. Dollar index, after reaching as low as 95.5 area, recovered sharply and currently trading at 96.37, up 0.28% for the day.

So what has been supportive of USD?

Recovery in global stock markets, viz. a viz. recovery in risk appetite. It has been Dollar positive because current turmoil has been viewed as an event to cause US Federal reserve to reconsider hike path. In the wake of turmoil, market has scaled back rate hike expectations from two to nil and bets are on the rise that FED might have to cut interest rates.

This has hit USD hard. So it is natural that USD likely to recover if market settles down.

However, it is important to note that USD's gains haven't been broad based. Risk favoring currencies have gained more since Friday, emerging market peers such as INR has outperformed USD.

Broad based USD support can only arrive when economic divergence becomes prominent. If US data continue to indicate, economy is healthier than the world and inflation is returning, then only USD can register broad based gains.

As of now, this is not, what we are observing, moreover it is not sure that turmoil is down with.