Institutional FX Insights: JPMorgan Trading Desk Views 29/5/26
JPM G10 FX Daily
29 May 2026
## EUR: Deal Hope, Month-End Noise, and Not Much Conviction
Going into the weekend hopeful of a deal — pretty sure that could have been written last Friday too.
Yesterday’s open was shrugged off as expected, then more positive Iran headlines helped risk rally in the afternoon. I honestly do not know how to handicap where we are, so there is limited value in pretending otherwise. Diminishing returns are clear in chasing anything until we get something more final.
Month-end today adds another layer of noise.
We chipped away reasonably well this week, but I am heading into the weekend with few positions. If there is an opportunity around rebalancing, fine. Otherwise, wait for headlines — or the lack of them.
I still like long USD/CHF for the reasons discussed previously, though the price action went from great to less convincing yesterday, perhaps caught up in month-end action. Adding some EUR/CHF here makes sense alongside.
I have taken most of the USD/ZAR back. That felt like a catch-up trade: the pair was not especially positioned, had lagged, and the SARB was not overly hawkish. Hit and run.
EUR recovered a touch yesterday as Iran pessimism turned back into optimism. But let’s face it: we are basically sitting at a level traded two weeks ago. It is largely unexciting.
With the market generally short EUR on the crosses, there is a school of thought that a more hawkish ECB could trigger a squeeze — contrary to our strategists’ view. That means country inflation prints today deserve attention ahead of Eurozone data on Tuesday.
I am somewhat surprised EUR has not tried a bit higher this morning given USD performance elsewhere. That probably says more about the broader lack of appetite for EUR than anything else.
Trade bias: Light / neutral EUR for now.
Positioning risk: EUR shorts on crosses could squeeze on hawkish ECB/inflation.
Data: Country inflation today; Eurozone inflation Tuesday.
Preferred CHF expression: Long USD/CHF and add EUR/CHF.
USD/ZAR: Mostly taken back after catch-up move.
Risk: Iran headline whipsaw into month-end.
---
## GBP: Stay Long EUR/GBP, Trim Into 0.87
Optimism around a 60-day ceasefire continues to build. Headlines are becoming more consistent on the likely contents, but we are still missing final sign-off from Trump and Iranian leaders.
That means the impediments to building more USD longs remain in place. One of those — month-end — should pass today, and likely includes some USD weakness from equity rebalancing.
For sterling, SHF buying remains a very strong trend:
- SHF bought 1.5z yesterday.
- That extends the buying streak to six sessions.
- This is happening despite negative GBP momentum.
Cable is back below the:
- 50dma: 1.3446
- 100dma: 1.3477
And it continues to challenge the:
- 200dma: 1.3423
News flow is also less sterling-friendly again. Burnham published an essay in The Times that sounded much more aligned with his left stance, framed as “business-friendly socialism.”
I am happy to stay long EUR/GBP here and will trim some into 0.8700.
Also worth noting: MSCI rebalancing is expected to feature GBP outflows.
Trade bias: Long EUR/GBP.
**Target / trim zone:** 0.8700.
Cable moving averages: 50d 1.3446, 100d 1.3477, 200d 1.3423.
Flow note: SHF GBP buying streak now at six sessions.
GBP-negative factors: Burnham left-risk, MSCI outflows, weak technicals.
Risk: Month-end USD weakness props cable temporarily.
---
## JPY: Still Under Pressure, Still Intervention Risk
There is no sign of relief in JPY pressure despite optimism around an Iran ceasefire. That will concern Katayama and Mimura, although they have been quiet by recent standards — especially Mimura.
Katayama repeated:
> No change in stance to respond to currency market; can take bold action if there is speculative FX move.
That did little to stir markets, as expected.
We get MoF intervention data at 11:00 BST. Market estimates are around JPY10trn, based on BoJ current account data.
Flows were mixed yesterday, and month-end today complicates things. Given fresh all-time highs in the Nikkei, there is some expectation that rebalancing will be JPY-negative this afternoon, alongside a purported MSCI outflow.
I am keeping JPY longs very modest and expressed against CHF to remain positive carry.
Trade bias: Very modest long JPY.
Preferred expression: Short CHF/JPY.
MoF data: Due 11:00 BST, expected near JPY10trn.
Month-end risk: Nikkei rebalancing and MSCI flows may be JPY-negative.
Intervention risk: Still live if USD/JPY presses higher.
---
## CHF: Fade the Rally
CHF found some strength yesterday as the dollar moved lower on reports that the US and Iran were close to signing a deal.
Month-end may also be supporting CHF, as recent month-ends have tended to see franc strength. On flows, systematics remain decent CHF buyers.
Despite that, the bearish CHF view remains intact.
We are looking to fade this recent CHF rally, especially as we head toward the “No to 10 Million” vote.
The CHF short case remains:
- Poor carry.
- SNB does not want a strong franc.
- Market positioning is long CHF.
- Risk stabilisation should reduce haven demand.
- CHF should return to being a funder if carry appetite improves.
Trade bias: Short CHF.
Tactical plan: Fade CHF strength.
Preferred expressions: Long USD/CHF and EUR/CHF; short CHF/JPY where appropriate.
Flow caveat: Systematics remain CHF buyers.
Risk: Month-end CHF strength extends further.
---
## AUD / NZD: AUD/NZD Near 1.20 After RBNZ Follow-Through
AUD/NZD is approaching 1.2000, and yes, taking profit on shorts too early is painful.
The cross extended lower after RBNZ Assistant Governor Silk said the central bank has not yet seen medium-term inflation pressures emerge, but is prepared to respond aggressively if they appear. That reinforced the hawkish message from this week’s meeting.
The comment, together with ANZ business activity data rising unexpectedly for the first time in three months despite the Middle East conflict, drove further AUD/NZD long liquidation.
SHFs have now sold AUD/NZD for three consecutive days.
Further losses are possible, but key support is approaching around 1.1925/50, which includes trendline support from June 2025 and the 100dma.
For now, I am on the sidelines, waiting for some form of Middle East resolution like everyone else. Next week’s Australian GDP print will also be important.
Trade bias: Sidelines after taking profit on short AUD/NZD.
AUD/NZD: Approaching 1.2000.
**Key support:** 1.1925/50.
Flow note: SHF have sold the cross for three consecutive days.
Next catalyst: Australia GDP next week.
---
## CAD: Still an Underperformer on Crosses
Improved sentiment around a potential US-Iran deal helped risk assets outperform yesterday, with USD/CAD dropping from 1.3860 to 1.3780 this morning.
Even if a resolution is reached, CAD is likely to remain an underperformer on crosses.
I continue to hold AUD/CAD longs, targeting a move above parity.
Canada GDP is today’s domestic focus. Growth is expected to be flat month-on-month, while the year-on-year figure is expected to slow to 0.9% from 1.0%. That would again underscore Canada’s weak growth profile.
Flows were mixed:
- Local real-money accounts showed stronger CAD demand.
- Systematic and hedge-fund accounts were notable CAD sellers.
Trade bias: Short CAD on crosses.
Preferred expression: Long AUD/CAD.
Target: Move above parity.
Data: Canada GDP today.
Risk: Broader risk rally gives CAD temporary relief.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% and 74% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
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!