The dollar holds the reins, but the basket is fragmenting

Universe

USD, EUR, GBP, JPY, CHF, CAD, AUD, NZD

Week

WPI / Seasonality

Update 17/07/2026

COT Report

Data as of 14/07/2026

1. The week's message

This week's picture is not a repeat of the previous one: the dollar remains the pivot, but the market is beginning to differentiate among counterparts. The short-term WPI signals a relative recovery in GBP, CAD and NZD, while the long-term WPI continues to favour USD, AUD and GBP. The point is therefore not to establish whether the dollar is strong or weak in absolute terms, but to identify where its leadership remains corroborated by COT, forwards and seasonality. JPY and CHF remain the weakest readings; EUR retains institutional support but has yet to translate it into relative strength; NZD is improving, though it starts from a still heavily penalised COT positioning.

Regime

USD still the basket's axis

The dollar maintains leadership across both WPI maps, but internal dispersion among the majors is widening.

Rotation

More visible tactical recoveries

GBP, CAD and NZD improve in the short term; AUD consolidates its position, particularly on the long-term reading.

Filter

Price movement alone is not enough

The COT distinguishes between short-covering rallies and genuine institutional confirmation: this is the key differentiator of the week.

2. Flexible Grid / WPI

The WPI shifts in character relative to a simple 'strong dollar' reading. In the short term the DXY remains the only element in Strong, but the noteworthy development is the migration of GBP, CAD and NZD into Improving. In the long term leadership broadens: AUD and GBP join the dollar in the Strong zone, NZD improves, while CHF slips into Weakening. The signal thus becomes less unidirectional and more rotational.

WPI lungo periodo aggiornato — WPI Long Term. The long-term structure is no longer dominated solely by the DXY: AUD and GBP are also in Strong, NZD recovers into Improving, while CHF loses quality and moves into Weakening. CAD, EUR and JPY remain the still-weak areas.

WPI breve periodo aggiornato — WPI Short Term. The DXY remains the basket's dominant force, but tactical rotation opens up toward GBP, CAD and NZD in Improving. AUD, EUR, JPY and CHF remain in Weak: no major is yet in Weakening on the short-term reading.

Reading rule. The WPI continues to represent currencies against USD. This week's operational message is not one of uniform major-currency weakness, but of selective rotation: certain currencies are improving against the dollar in the short term, while others remain structurally weak.

Currency / index	Short-term WPI	Long-term WPI	Translation to the classic pair
DXY	Strong	Strong	Dollar still in command: strength confirmed across both short and long term.
EUR	Weak	Weak	The euro remains anchored in Weak territory, despite a still structurally supportive COT.
GBP	Improving	Strong	Sterling in tactical recovery and strong on the long term: a better signal than the previous week.
JPY	Weak	Weak	Yen with no WPI recovery: it continues to be one of the weakest areas in the basket.
CHF	Weak	Weakening	Franc deteriorating on the long term: moving from simple weakness to a loss of relative quality.
CAD	Improving	Weak	CAD improves in the short term, but the structural picture remains incomplete.
AUD	Weak	Strong	AUD weak in the short term but strong on the long term: a divergence that needs to be confirmed by flows and price action.
NZD	Improving	Improving	NZD recovers across both readings, but the COT remains the primary risk filter.

3. Seasonality and maximum synchronisation

Seasonality introduces a more granular reading: there is no single historical depth that is universally valid for the entire basket. DXY remains stable on the 5-year window, CAD works better on the 15-year depth, while EUR requires a deeper 20-year curve. NZD shows an interesting seasonal improvement, but one that still needs to be read in conjunction with the COT's short positioning.

Massima sincronizzazione stagionale aggiornata — Max Sync. The platform selects, for each currency, the historical depth that is currently best replicating the actual price behaviour. Thanks to the mosaic view, the panel compares the entire Forex basket and immediately highlights, for each currency, the seasonal curve most closely aligned with current price behaviour.

Instrument	Max Sync curve	Status	Current window reading
DXY	5 years	Stable Sync	5-year stable alignment: seasonality remains consistent with dollar leadership.
AUD	5 years	Entering Sync	5-year entering sync: constructive timing, but COT confirmation is required.
GBP	10 years	Entering Sync	10-year Entering Sync: timing supports the improvement already seen in the WPI.
CAD	15 years	Stable Sync	15-year Stable Sync: one of the cleanest seasonal readings in the basket.
EUR	20 years	Entering Sync	20-year Entering Sync: favourable signal, but still at odds with the weak WPI.
CHF	10 years	Entering Sync	10-year Entering Sync, but WPI deterioration limits signal quality.
JPY	10 years	Unknown	Signal still unreliable: seasonality does not become an operational driver.
NZD	5 years	Entering Sync	5-year Entering Sync, with a positive 10Y focus that remains only partially synchronised.

6N New Zealand Dollar Future

6N Focus. The New Zealand Dollar Future sheet shows a 10-year window in Partial Sync, with Sync Level +0.26 and Sync Trend +0.09. Pattern statistics remain constructive: avg per trade +2.69%, win rate 80% and 10-year cumulative return +26.9%. For the month of July the average is +0,4% with a positive frequency of 54%. The data helps explain the NZD's WPI improvement, but does not eliminate the need for COT confirmation.

4. COT Report — Asset Managers

The COT as of 14 July reflects a week of consolidation rather than uniform confirmation. The dollar remains supported by Asset Managers; sterling improves primarily through short covering; the CAD shows a more orderly recovery; the euro retains a sizeable long stock but is losing marginal momentum. JPY, CHF and NZD remain constrained by significant short positions.

Asset	Total Long	Total Short	Δ Long	Δ Short	Delta change	Reading
DXY / USD	24.260	2.221	+1.799	+1.184	+615	Dollar still supported: elevated long stock and positive weekly flow, despite an increase in short positions as well.
EUR	466.709	219.393	−11.361	−4.759	−6.602	Long stock still dominant, but the weekly flow cools as longs decline more than shorts.
GBP	14.195	145.599	+199	−11.654	+11.853	Significant tactical improvement driven by short covering, but sterling remains heavily net short in stock terms.
JPY	74.624	128.441	+511	+5.675	−5.164	Shorts rising faster than longs: reading still negative for the yen.
CHF	6.818	48.407	−126	−1.845	+1.719	Franc still structurally short, but with weekly short covering.
CAD	40.832	147.319	+670	−1.186	+1.856	CAD improves on rising longs and falling shorts, though it remains skewed to the short side.
AUD	54.353	94.922	+1.898	+5.164	−3.266	Negative divergence: Asset Managers increase both longs and shorts, but shorts grow significantly more.
NZD	8.063	61.825	−462	−4.268	+3.806	Short covering is evident, but stock remains heavily short: tactical improvement, not yet structural confirmation.

The key point. Improvement in certain currencies should not be read automatically as new institutional accumulation: in several cases it is primarily short covering. The week should therefore be interpreted with a precise hierarchy: USD still confirmed, EUR supported but weak in price, GBP/CAD/NZD in tactical recovery, JPY and CHF still fragile.

5. Official Rates and 1-Year Forwards

The one-year forward curve continues to show wide dispersion across currencies. GBP and AUD carry the highest forward profiles in the basket; USD remains above the Fed corridor; NZD retains a significant repricing; CHF stays nearly neutral. This data should be used as a confirmation filter, not as a point forecast.

Currency	Current official rate	1Y Forward	Message
USD	3,50%–3,75% Federal Funds target range	4,368%	Restrictive The forward remains above the Fed corridor: the dollar retains a still-meaningful monetary premium.
EUR	2,25% ECB deposit facility; MRO 2.40%	2,999%	Priced-in hike The forward continues to rise above the current rate, but the WPI has yet to confirm strength in the euro.
GBP	3,75% Bank Rate	4,571%	Elevated carry Sterling has the highest forward in the basket and receives WPI support, but the COT remains net short.
JPY	1,00% Overnight call rate target	1,633%	Normalisation The forward prices in further normalisation, but WPI and COT remain weak for the yen.
CHF	0,00% SNB policy rate	0,032%	Near neutral The forward is nearly flat: the franc does not receive sufficient monetary support to offset its relative weakness.
CAD	2,25% Target overnight rate	3,112%	Decisive hike The Canadian forward remains above the current rate and combines with short covering and stable seasonality.
AUD	4,35% Cash rate target	4,511%	High carry AUD maintains one of the highest forward profiles and the long WPI is at Strong; however, COT has yet to confirm.
NZD	2,50% Official Cash Rate	4,160%	Strong repricing The repricing remains wide and supports the NZD reading, but the COT positioning is still heavily short.

How to read the block. This week's development is not the absolute level of the forwards, but their coherence with WPI and COT. GBP and AUD carry high carry, but only GBP finds broader confirmation in the WPI; NZD has high repricing but a still-fragile COT; CHF continues to lack meaningful monetary support.

Official rates verified as of 17 July 2026. Sources: Federal Reserve · ECB · Bank of England · Bank of Japan · Swiss National Bank · Bank of Canada · Reserve Bank of Australia · Reserve Bank of New Zealand.

6. Major currency map

GBP/USD

Dominant driverSterling is one of the most interesting rotations: it improves in the short WPI, is rated Strong in the long WPI, and carries the highest forward in the basket.

ConfirmationThe COT signals very strong short covering: Asset Manager short positions fall by more than 11,000 contracts.

DivergencePositioning remains heavily skewed to the short side, meaning the recovery is not yet fully institutional in nature.

Trigger conditionThe pair would become more constructive only if short covering were to translate into sustained long accumulation.

AUD/USD

Dominant driverAUD is strong in the long-term map and retains a high carry, but the short-term picture has yet to confirm.

ConfirmationThe 5-year seasonal window moves into sync, offering timing support for the rotation.

DivergenceAsset Managers are adding shorts at a faster pace than longs: COT does not yet validate the structural strength of the long WPI.

Trigger conditionA reduction in AUD short positioning is needed to make the long signal more reliable.

NZD/USD

Dominant driverNZD is the currency with the most pronounced recovery across the short WPI, long WPI, and Max Sync.

ConfirmationThe forward remains elevated and the 10Y seasonal focus shows positive statistics on the selected pattern.

DivergenceCOT is improving on short covering, but the Asset Manager net position remains heavily short.

Trigger conditionTrue confirmation would come from fresh institutional long positioning, not merely from the closing of short positions.

EUR/USD

Dominant driverThe euro still holds the strongest institutional long stock, but has been unable to break out of the Weak zone in the WPI.

ConfirmationThe forward curve rises towards 3% and the 20-year seasonality moves into sync.

DivergenceThe weekly COT flow is less encouraging: longs are declining more than shorts.

Trigger conditionA change in the overall picture requires institutional support to once again translate into relative strength in the WPI.

USD/JPY

Dominant driverJPY remains weak across all WPI maps and receives no reliable seasonal confirmation.

ConfirmationThe COT deteriorates on the delta: Asset Manager short positions increase more than longs.

DivergenceThe Japanese forward prices in normalisation, but the market has yet to reward it at the exchange rate level.

Trigger conditionThe pro-USD/JPY view would only weaken with JPY short covering and a loss of DXY momentum.

USD/CHF

Dominant driverCHF is the currency losing the most quality in the long WPI, moving into Weakening.

ConfirmationThe Swiss forward is near zero: the franc lacks genuine monetary support.

DivergenceCOT shows short covering and the Max Sync is entering sync, but for now this is insufficient to shift the regime.

Trigger conditionA WPI recovery and sustained improvement in COT positioning are needed to erode the dollar's advantage.

USD/CAD

Dominant driverCAD improves in the short term and has a stable 15-year Max Sync, but remains weak in the long-term map.

ConfirmationThe COT is constructive on the delta: longs increasing and shorts declining among Asset Managers.

DivergenceThe stock remains heavily short and the DXY maintains leadership across both time horizons.

Exchange rate conditionThe picture would only shift with further CAD short covering and a loss of dollar strength.

7. Scenario map

Dominant scenario

The dollar retains its role as the leading currency, but this week's report should not be read as mere continuity. The internal rotation is broader: some currencies improve in the WPI, others find seasonal support, while others remain constrained by the COT. The dollar's advantage is therefore still present, but must be applied with greater selectivity.

What could invalidate it

The DXY exiting the Strong area on either of the two WPI horizons.
The short covering on GBP, CAD or NZD transforming into fresh long accumulation.
Price confirmation of the constructive seasonal windows on AUD, GBP, CAD and NZD.
A return of the euro to relative strength, consistent with the still-elevated institutional long positioning.

Conclusion. The week should be read as a transition from dollar dominance to selective dollar dominance. USD/JPY and USD/CHF remain the most consistent pairs in favour of the greenback; GBP/USD, AUD/USD and NZD/USD warrant closer attention as the rotation is improving; EUR/USD remains the primary divergence between institutional support and relative weakness.