Following a volatile start to the month driven by U.S. economic data, this week shifts focus toward European and British economies. Markets are seeking equilibrium after significant dollar moves, with the primary catalysts being inflation reports (CPI) from the UK and Canada, along with final GDP revisions in the Eurozone.
While the U.S. macro calendar is lighter this time, technical levels and the lingering effects of major central bank policies will take center stage.
🇪🇺🇺🇸 EURUSD — Sentiment: 0 (Neutral)
Fundamental Outlook The Eurozone will release GDP data on Tuesday and PMI indices on Friday. Markets do not expect any major positive surprises, keeping the Euro on the defensive. The Dollar may consolidate slightly following last week’s rally, provided Wednesday’s FOMC Minutes do not signal a need for further aggressive tightening.
Technical Outlook
Swing support: 1.0760, 1.0700
Swing resistance: 1.0920, 1.1000
Intraday support: 1.0810, 1.0785
Intraday resistance: 1.0880, 1.0910
🇬🇧🇺🇸 GBPUSD — Sentiment: –1 (Mildly Bearish for GBP)
Fundamental Outlook The key highlight of the week is Wednesday’s UK CPI. A slight dip in inflation is expected, which could reinforce market expectations that the Bank of England will begin cutting rates sooner. This puts the Pound at a disadvantage against the Dollar, which continues to benefit from a robust U.S. labor market.
Technical Outlook
Swing support: 1.2500, 1.2420
Swing resistance: 1.2680, 1.2750
Intraday support: 1.2560, 1.2530
Intraday resistance: 1.2630, 1.2660
🇺🇸🇯🇵 USDJPY — Sentiment: +2 (Strong Long)
Fundamental Outlook The Japanese Yen remains under heavy pressure due to Bank of Japan’s passivity. Despite verbal interventions, the interest rate differential with the U.S. remains too wide. As long as U.S. yields do not retreat, the sentiment on this pair remains strongly bullish.
Technical Outlook
Swing support: 150.50, 149.20
Swing resistance: 152.50, 153.80
Intraday support: 151.10, 150.80
Intraday resistance: 151.90, 152.20
🇬🇧🇯🇵 GBPJPY — Sentiment: +1 (Mildly Bullish)
Fundamental Outlook This pair will be extremely sensitive to Wednesday’s UK inflation data. Although there is a downside risk for the Pound if CPI misses, the Japanese Yen is currently so weak that the overall sentiment on GBPJPY remains tilted to the upside.
Technical Outlook
Swing support: 188.50, 186.80
Swing resistance: 191.80, 193.00
Intraday support: 189.40, 189.00
Intraday resistance: 190.60, 191.10
🇦🇺🇺🇸 AUDUSD — Sentiment: –2 (Strong Short)
Fundamental Outlook The RBA meeting minutes confirmed a cautious stance. Weakening demand from China and falling iron ore prices are creating strong selling pressure on the Australian Dollar. Combined with a strong U.S. Dollar, this is one of the most bearish pairs of the week.
Technical Outlook
Swing support: 0.6440, 0.6380
Swing resistance: 0.6600, 0.6650
Intraday support: 0.6490, 0.6470
Intraday resistance: 0.6535, 0.6560
🇪🇺🇬🇧 EURGBP — Sentiment: +1 (Mildly Bullish for EUR)
Fundamental Outlook In the battle between two weaker European currencies, we are leaning slightly toward the Euro this week. UK data has a higher potential to disappoint and trigger a Pound sell-off, which could push EURGBP toward a technical correction higher, as the Euro appears oversold relative to Sterling.
Technical Outlook
Swing support: 0.8490, 0.8450
Swing resistance: 0.8620, 0.8680
Intraday support: 0.8525, 0.8510
Intraday resistance: 0.8565, 0.8585
🇺🇸🇨🇦 USDCAD — Sentiment: +2 (Strong Long)
Fundamental Outlook Tuesday’s Canadian CPI will be pivotal, with a slowdown in inflation expected. This would give the Bank of Canada room for a more dovish tone. Given the strong U.S. Dollar and stable oil prices—which currently offer no support to CAD—we expect a strong upward trend.
Technical Outlook
Swing support: 1.3440, 1.3350
Swing resistance: 1.3620, 1.3700
Intraday support: 1.3510, 1.3485
Intraday resistance: 1.3575, 1.3600
🇨🇦🇯🇵 CADJPY — Sentiment: 0 (Neutral)
Fundamental Outlook This pair will be driven by the combination of Tuesday’s Canadian inflation and global yields. If Canadian inflation drops, CADJPY may lose momentum despite Yen weakness. The market is likely to remain in a range-bound trend until a clear direction emerges in the oil market.
Technical Outlook
Swing support: 110.50, 109.80
Swing resistance: 112.80, 113.50
Intraday support: 111.30, 111.05
Intraday resistance: 112.10, 112.40
🇦🇺🇯🇵 AUDJPY — Sentiment: –1 (Mildly Bearish)
Fundamental Outlook The Australian Dollar is hitting fundamental barriers in China. Despite a weak Yen, the Aussie is more vulnerable to any signs of deteriorating global risk sentiment. The pair is currently facing strong technical resistance levels.
Technical Outlook
Swing support: 97.20, 96.50
Swing resistance: 99.40, 100.20
Intraday support: 98.10, 97.80
Intraday resistance: 98.85, 99.15
Conclusion
The week of February 16–20 will primarily revolve around confirming or refuting current trends. Markets will be highly sensitive to any deviations in inflation data from the UK and Canada. For traders, this means exercising increased caution mid-week and strictly monitoring technical resistance levels on USD pairs.
Regarding the Yen, we recommend paying close attention to verbal comments from Japanese officials, which could trigger flash volatility in an otherwise steady trend.
Wishing you a successful trading week!