Institutional FX Insights: JPMorgan Trading Desk Views 21/4/26
FX remains headline-driven, but the broad message is unchanged: stay tactically bearish USD, avoid chasing extremes, and keep positioning nimble into this week’s geopolitical and macro event risk.
EUR
EUR had a big run on the weak-dollar trade, but momentum is starting to look tired. Friday’s whipsaw and the latest geopolitical headlines have reduced the appeal of simply chasing euro strength, especially with markets becoming less reactive to every headline. The bias remains for a smaller core long EUR position, but conviction likely needs a clearer catalyst.
Technically, EURUSD needs to hold 1.1675–1.1700 to preserve the bullish tone after failing above 1.1830 last week. The broader view is that investors still seem too bearish on the Eurozone, which helps justify keeping some euro length, but if there is any kind of uneasy de-escalation in Iran, that long euro positioning could come under pressure.
GBP
Sterling still lacks a compelling idiosyncratic story. UK labour data were not weak enough to meaningfully damage the currency, especially with politics failing to trigger much of a market reaction so far. That said, domestic political noise remains an overhang, and tomorrow’s CPI report matters more for the MPC than today’s backward-looking labour release.
The preference is still to express the anti-dollar view less through GBP and more through EUR, with EURGBP longs retained core, even after trimming on the labour data. Key levels are 0.8680–0.8750 in EURGBP and 1.3480–1.3600 in cable. Flow-wise, real money remains a seller of GBP, with discretionary hedge funds also still leaning that way.
JPY
JPY remains difficult to love as the preferred USD short. There is still little evidence of the long-awaited structural repatriation story showing up in size, and the latest BoJ financial system report did little to change that. For now, the view remains mildly short USD, but not via JPY.
In spot, USDJPY remains stuck in the 158–160 range, and absent a more forceful risk-off shock or a real shift in Japanese investor behaviour, it is hard to build strong conviction on yen strength.
CHF
CHF is acting more like a classic safe haven again, especially against the backdrop of broader risk-off and “sell America” style themes. That has pushed EURCHF and USDCHF lower, but there is still reluctance to chase franc strength aggressively given the SNB’s discomfort with excessive CHF appreciation.
The more tactical expression here is around crosses, with some CHFJPY shorts put on near the highs. Flows remain light, though systematic accounts continue to sell CHF.
AUD / NZD / NOK / SEK
The broader preference remains for commodity and high-carry FX over USD, especially NOK and AUD, supported by favourable terms of trade, relatively hawkish central banks, and solid fiscal backdrops. Positioning still looks light, which leaves room if risk sentiment holds up.
NZD got an extra boost from stronger-than-expected inflation, which pushed yields higher and brought forward pricing for the next RBNZ hike. That gives the kiwi some near-term support, especially on crosses, with AUDNZD moving lower and technical levels now starting to matter more.
Trader TakeAways
Still broadly bearish USD
Prefer EUR longs, but in reduced size
GBP not weak enough to be a clean short, but not the best anti-dollar trade either
JPY still not convincing as the main USD short
CHF supported, but not something to chase aggressively
NOK, AUD, and now NZD remain attractive on carry/macro grounds
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!