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FX & Rates · 9 July 2026
The dollar's failure to hold gains through hawkish Fed and BoE signals is not fundamental weakness…
The dollar's failure to hold gains through hawkish Fed and BoE signals is not fundamental weakness but a function of record-crowded euro and yen shorts (most stretched since data began for euro, 96th percentile for yen), leaving the dollar short asymmetrically exposed to a squeeze rather than further weakness.
- What would prove it wrong
- If EUR/USD and USD/JPY continue extending in their current direction without any squeeze or reversal over the coming week despite these extreme positioning readings, the crowded-short thesis fails.
- Status
- Later note
This is the desk’s own dated record, settled against market data. Descriptive of a research thesis, not investment advice.