Weekly FX Technical Analysis - 18th February 2026

This week’s charts capture a market that’s pausing after some big moves: GBP/USD is consolidating after its breakout attempt into the 1.38s, EUR/GBP remains heavy beneath its prior range, EUR/USD is grinding sideways below the key 1.19–1.20 ceiling, and USD/JPY is attempting to stabilise after a sharp pullback.

The common theme is level sensitivity—price is sitting close to pivots that should define the next leg. In the sections below, we map the key levels, outline bullish/bearish scenarios, and highlight the macro drivers most likely to matter in the days ahead.

GBP/USD

GBP/USD has cooled from the recent spike into the 1.38s and is now consolidating around the mid-1.35s, with spot last near 1.3535. The broader uptrend from the November lows remains intact, but price has slipped back below the short-term trend support and is now leaning on the 1.35 area as near-term pivot support. A sustained hold above 1.3500–1.3550 would keep the recovery constructive, while a decisive break lower would suggest the post-breakout move is being unwound. RSI has eased back toward the mid-40s, signalling that upside momentum has faded and the pair may remain range-bound unless bulls reclaim the recent highs.

Potential Scenarios

• Bullish: A reclaim and hold above 1.3645 would stabilise momentum and reopen a move back toward 1.3700, with 1.3858 the key upside level to beat.

• Bearish: A break below 1.3500/1.3480 would expose 1.3450 and then 1.3287, increasing the risk of a deeper retracement toward the prior base.

Macro Backdrop to Consider

Sterling remains sensitive to shifts in US rate expectations and broader risk sentiment. With the market still debating the timing and pace of 2026 easing cycles, short-term direction is likely to track moves in US yields and any repricing of the Fed path, while UK data surprises can still generate sharp, headline-driven moves in GBP.

GBP/USD: FEBRUARY ‘25 - PRESENT

EUR/GBP

EUR/GBP remains pressured and is still trading below its former support zone, with spot last near 0.8626. The pair continues to struggle to regain the broken range, and the recent rebound attempts have been shallow, keeping the short-term bias tilted to the downside. The RSI remains depressed (mid-30s), suggesting downside pressure has been persistent, though the oversold backdrop also raises the risk of sharp corrective bounces if resistance is reclaimed. For now, the market is watching whether 0.8620–0.8600 continues to hold, or whether price slips back toward the next support band.

Potential Scenarios

• Bullish: A move back above 0.8670–0.8700 would improve the near-term tone and bring 0.8718 into focus, with a broader recovery possible if the pair can re-enter the prior range.

• Bearish: Failure to hold 0.8620/0.8600 would leave the pair vulnerable to a deeper drop toward 0.8500, the next key support.

Macro Backdrop to Consider

EUR/GBP remains driven by relative rate expectations and growth differentials between the UK and Eurozone. Any repricing around the BoE versus ECB path—particularly as markets reassess the 2026 easing profile—can quickly shift the balance, while risk sentiment often amplifies moves when liquidity thins.

EUR/GBP: FEBRUARY ‘25 - PRESENT

EUR/USD

EUR/USD continues to consolidate after the sharp push into the 1.20 area, with spot last near 1.1801. Price remains capped beneath the key resistance band around 1.19–1.20, but the broader structure still looks constructive while dips are being supported above the mid-1.16s. The pair has rotated into a choppy range, and the market now needs a clear break to define the next trend leg. RSI sits near the low-50s, consistent with consolidation rather than a strong directional impulse.

Potential Scenarios

• Bullish: A sustained break back above 1.1900 would shift momentum higher and put 1.2009 back in play as the key resistance, with follow-through opening a renewed upside leg.

• Bearish: A break below 1.1700 would increase the risk of a deeper pullback toward 1.1600, with 1.1496 the next major support area if downside pressure accelerates.

  
  

Macro Backdrop to Consider

EUR/USD remains highly sensitive to the relative path of Fed versus ECB policy expectations and shifts in global risk appetite. With markets still recalibrating the outlook for 2026 rate cuts, near-term direction is likely to follow US yield moves and data surprises, with positioning potentially amplifying moves around key levels near 1.19–1.20.

EUR/USD: FEBRUARY ‘25 - PRESENT

USD/JPY

USD/JPY has stabilised after the sharp pullback from the highs, with spot last near 155.76. The broader uptrend structure from mid-2025 remains in place, but momentum has cooled notably following the recent volatility. Price is now trying to rebuild a base above 153.80–154.70, and a sustained hold here would help restore upside traction. RSI has recovered back toward the high-40s/low-50s area, indicating stabilisation but not a fully re-accelerating trend.

Potential Scenarios

• Bullish: A close back above 156.59 would improve the near-term outlook and reopen a push toward 158.15, with 160.69 as the major upside level above.

• Bearish: A break back below 153.80 would expose 152.49 and then 151.27, signalling that the corrective phase is not yet complete.

  
  

Macro Backdrop to Consider

USD/JPY remains primarily a function of US-Japan yield differentials and shifts in risk sentiment. Any renewed repricing in US rates or changes in expectations around Japanese policy normalisation can produce outsized moves, particularly when the market is positioned heavily in one direction.

USD/JPY: FEBRUARY ‘25 - PRESENT

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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.