Weekly FX Technical Analysis - 13th July 2026

This week’s FX technical analysis highlights a more decisive shift across several major currency pairs. GBP/USD has recovered back toward 1.3400 but remains below key resistance, EUR/GBP has broken below its long held range support around 0.8600, EUR/USD is under pressure after losing 1.1500, and USD/JPY has pushed above 162.00 into levels where intervention risk is now a central consideration.

The macro backdrop remains highly active, with Middle East tensions, Strait of Hormuz risks, higher oil prices, Fed policy expectations, UK political pressure and central bank divergence all feeding into market volatility.

GBP/USD

GBP/USD is trading around 1.3400, with sterling recovering from the recent lows but still struggling to regain the stronger momentum seen earlier in the year. The pair has moved back toward the 1.3400/1.3450 area, although the broader technical picture remains mixed while price trades below the major resistance zone around 1.3600/1.3650.

Potential Scenarios

• Bullish: A sustained move above 1.3450 would improve sentiment and could open another test of 1.3600/1.3650.

• Bearish: A failure to hold above 1.3300 would weaken the recovery and bring the 1.3150/1.3200 support region back into focus.

Macro Backdrop to Consider

Sterling remains sensitive to UK political risk, with the Labour leadership contest continuing to weigh on perceptions of government stability, while the Bank of England faces a difficult balance between weaker growth and persistent inflation concerns. The US dollar has also found support from renewed Middle East tensions, higher oil prices, and markets reassessing the Fed outlook ahead of inflation data and Chair Kevin Warsh’s testimony.

House View

Neutral GBP/USD, with the pair needing a sustained move back above 1.3450 to rebuild bullish momentum.

GBP/USD: JULY ‘25 - PRESENT

EUR/GBP

EUR/GBP is trading around 0.8540, having broken below the long held 0.8600 support area. This marks a notable shift in the technical picture, with the pair now testing the lower end of its broader range and moving close to the key 0.8500 support region.

Potential Scenarios

• Bullish: A recovery back above 0.8600 would ease immediate downside pressure and could allow a move back toward 0.8700/0.8750.

• Bearish: A sustained break below 0.8500 would confirm a deeper technical deterioration and could expose further downside.

Macro Backdrop to Consider

EUR/GBP is being pulled between UK political uncertainty and a more complicated eurozone inflation picture. The ECB has shifted more hawkishly as energy driven inflation pressure returns, while sterling faces domestic political questions and a Bank of England that remains divided on the policy path. With both economies facing fragile growth, the next move is likely to depend on which central bank appears more constrained by inflation.

House View

Neutral to bearish EUR/GBP, with 0.8500 now the key level to watch after the break below 0.8600.

EUR/GBP: JULY ‘25 - PRESENT

EUR/USD

EUR/USD is trading around 1.1440, after breaking below the important 1.1500 support region. The pair remains under pressure within a short term downtrend, with sellers still in control while price trades below the 1.1500/1.1600 zone.

Potential Scenarios

• Bullish: A recovery back above 1.1500 would help stabilise the pair and could allow a move toward 1.1600/1.1700.

• Bearish: A sustained move below 1.1400 would confirm further downside momentum and expose the 1.1300/1.1320 support region.

  
  

Macro Backdrop to Consider

The euro remains vulnerable as higher energy prices and renewed Middle East tensions complicate the ECB’s inflation outlook, while growth concerns remain in the background. The US dollar has benefited from safe haven demand linked to the Gulf conflict and Strait of Hormuz risks, alongside higher yields and renewed debate around whether the Federal Reserve may need to stay tighter for longer.

House View

Bearish EUR/USD, with the pair needing to reclaim 1.1500 quickly to avoid a deeper move toward 1.1300.

EUR/USD: JULY ‘25 - PRESENT

USD/JPY

USD/JPY is trading around 162.00, having broken above the previous 160.00 resistance area and moved to fresh multi decade highs. The broader uptrend remains intact, although the pair is now trading in a zone where volatility and intervention risk become increasingly important.

Potential Scenarios

• Bullish: A sustained break above 160.00 could allow further upside momentum toward 162.00.

• Bearish: Failure to hold above current levels could trigger profit taking and a move back toward 158.00, with further support around 156.00.

Macro Backdrop to Consider

The yen remains under pressure as wide US/Japan yield differentials continue to favour the dollar. Japanese authorities have kept intervention warnings alive after the yen reached its weakest levels in decades, while renewed Middle East tensions and higher oil prices add another layer of risk for Japan as an energy importer. Any official intervention threat is now a major market consideration around these levels.

House View

Cautiously bullish USD/JPY, although intervention risk is now materially higher above 160.00.

USD/JPY: JUNE ‘25 - PRESENT

As always, if you’d like to discuss these moves in more detail, or how they could impact your business or personal requirements, please don’t hesitate to get in touch.

info@k2-fx.com

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Disclaimer: The information in this publication is provided for general information purposes only. It does not constitute financial or investment advice, nor should it be relied upon as such. Readers should consider their own circumstances and seek independent advice where appropriate.