Technical Analysis: Week 7, 2026
(EUR/JPY | AUD/USD | DAX 40)
Welcome to your weekly edge in the markets with clear, actionable insights.
It’s split into two parts:
- Week Ahead – An overview of current market conditions, previewing the week ahead.
- Technical Analysis – our top 3 trade ideas for the week, complete with charts and key levels to watch.
Week Ahead
Week of February 16, 2026
Stock markets remain volatile as artificial intelligence shifts from being a pure upside narrative to a disruption risk. Meanwhile, gold and silver struggled for direction - with gold stuck at $5000 per oz.
Last year’s AI-fuelled rally has morphed into a “who gets disrupted next?” debate. Software stocks have been under pressure, while capital expenditure concerns and profit-taking continue to shake tech leadership.
In forex, the yen was top gainer, surging after Japan’s snap election, with yen crosses, including EUR/JPY forming possible top patterns - while the dollar edged higher versus most majors.
Week in Review
News & Macro
AI disruption fears intensify
After leading the bull market since October 2022, tech stocks are now under sustained pressure. The heavyweight technology sector is down over 4% year-to-date, and single-stock AI winners/losers are showing increasingly extreme moves.
Has the yen bottomed?
The Japanese yen’s recent appreciation marked its largest weekly gain since late 2024, supported by fiscal clarity after election outcomes and verbal intervention from Tokyo aimed at managing foreign exchange flows. Short-covering after a long decline is likely contributing to the sudden strength.
Soft CPI, strong jobs
- January CPI: +0.2% m/m (below +0.3% expected)
- Nonfarm Payrolls: +130,000 vs +70,000 forecast
- Unemployment rate: 4.3%
The combination supports a “soft landing” narrative but likely delays aggressive Fed rate cuts.
Retail slowdown
US retail sales were flat (vs +0.4% expected). Control group -0.1% m/m.
China disinflation continues
- CPI: 0.2% YoY
- Core CPI: 0.8% YoY (weakest in six months)
- PPI: -1.4% YoY
Price Action Snapshot
- S&P 500: -1.4% on the week
- Nasdaq Composite: -2.1%
- Dow Jones Industrial Average: -1.2%
- AUD/USD: (near) 4-year high
- EUR/JPY: 2-month low
- VIX: surged to 20.81 from 17.77
- Crude Oil: $62.85 (-1.1%)
- Gold: $4,920 (-0.9%)
- Bitcoin: $66,362 (-5.56%)
Week Ahead
Market Themes to Watch
- Core PCE – The Real Inflation Test
Friday’s Personal Consumption Expenditures (PCE) index is the Fed’s preferred gauge. After soft CPI, confirmation here could stabilise risk sentiment. - GDP & Sentiment
Advance Q4 US GDP and consumer sentiment data will test the “stabilisation” narrative implied by strong jobs. - AI Narrative Shift
Markets are transitioning from AI optimism to creative-destruction pricing. If weakness spreads beyond software into broader indices, volatility could escalate. - Bond Repositioning
US Treasuries have started to attract interest after years of being ignored in the “everything rally.” A sustained bid could pressure equities further. - Asia-Pacific
- Japanese Q4 GDP
- RBA Minutes
- RBNZ rate decision (first press conference for Governor Anna Breman)
- Australian employment
- Supreme Court Tariff Opinion
An ‘opinion’ (NOT final decision) on Trump-era tariffs next Friday could be a major volatility event.
Corporate & Earnings Calendar
Earnings Highlights
The key report next week: Walmart
Walmart recently crossed a $1 trillion market cap and is up 20% year-to-date. As the largest company in the consumer staples sector, its earnings will serve as a read-through on:
Retail peers reporting soon include:
- Home Depot
- Lowe's
- Target
Economic Calendar
Monday 16 Feb
- US: Presidents’ Day – markets closed
Tuesday 17 Feb
- Germany: CPI (Jan) – Precursor to broader Eurozone inflation
- UK: Unemployment (Jan) and labour market readings
Wednesday 18 Feb
- US: Federal Reserve Minutes (Jan) – Policy deliberations insight
- Europe / UK: PMI services/manufacturing releases (flash or national)
Thursday 19 Feb
- Europe / UK: PMI surveys continuation (services & manufacturing)
Friday 20 Feb
- US: Advance Q4 GDP – Growth dynamics
- US: Personal Consumption Expenditures (PCE) Price Index & Core PCE – Fed’s preferred inflation gauge
US: PMI final services & manufacturing - UK: Retail Sales (Jan)
Technical Analysis
We look at hundreds of charts each week and present you with three of our favourite setups and strategies.
EUR/JPY
Setup
Bearish - Uptrend reversal
- Hi 2-month low
- Evening star on monthly chart
- Broken uptrend line on daily chart
- Broken support at 182
- Break below 20/50 SMAs
- Still 700 pips above 200 SMA (overbought)
Commentary
After a monster 10-month rally, euro-yen is losing steam and seems to have posted a triple top reversal. Possible downside targets are 178 then 175 (200 day SMA).
Strategy
- Sell below 182
- Sell a rally to 183 / broken trendline retest
AUD/USD
Setup
Bullish - trend continuation
- Corrective pattern complete after large impulsive move up
- Broken and closed above long term resistance at 0.69
- After pullback from LT resistance at 0.71-715, looking for breakout
- Price above 20/50/200 SMA
Commentary
There is strong bullish momentum in the Aussie dollar and we are looking for that to continue. The main risk is a bull trap after a big rally but the corrective move looks over and the next impulsive move is about to begin.
Strategy
- Buy over 0.705
- Buy dip to 0.70
DAX 40 (G40/EUR)
Setup
Bullish - trend continuation
- 25,000 round number big resistance
- Monthly price range looks like continuation pattern, not reversal
- Looking for next impulsive move up after correction
- Price above 20/50/200 day SMAs
Commentary
The breakout to record highs over 25,000 saw bulls get trapped with a drop back under the breakout zone around 24,750. Now looking for that zone to hold as support on the next attempt to break higher. A drop under the 200 SMA would be bearish.
Strategy
- Buy above 24,750
- Buy close above 25,000
But - as always - that’s just how the team and I are seeing things, what do you think?
Share your ideas OR send us a request!
Cheers,
Jasper
Disclaimer:
The communication does not constitute investment or trading advice, nor does it include any recommendations. Additionally, it does not serve as an offer or solicitation to engage in transactions involving financial instruments. WeTrade does not take responsibility for any actions taken based on the information provided, nor for any outcomes that may occur as a result of the actions taken.
