**Pairs in Focus: 22th to 27th February 2026**
*Based on content originally posted by Adam Lemon, DailyForex.com*
**Introduction**
As the final full trading week of February 2026 approaches, the global forex markets will witness a convergence of critical technical levels, macroeconomic catalysts, and sentiment-driven trends. Encouraged by an evolving interest rate landscape, diverging economic indicators, and persistent geopolitical uncertainties, major currency pairs are poised for heightened volatility. This analysis explores possible scenarios and key technical levels for the week ahead, underscoring actionable insights and risk management considerations for major FX pairs.
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**US Dollar Outlook (DXY Index)**
In recent weeks, the US Dollar Index (DXY) has encountered significant volatility, shaped primarily by mixed data flow from the US economy and shifting expectations regarding Federal Reserve policy. With inflation readings moderating but not yet aligning fully with the Fed’s target, the dollar’s path remains highly data-dependent.
**Key Points:**
– DXY finished last week near the 104.50 mark, holding above its 20- and 50-day moving averages.
– Markets are now pricing a prolonged higher-for-longer rate stance from the Fed, with rate cut expectations being pushed further into 2026.
– Near-term resistance is found at 105.10, with a breakout above this level likely targeting 106.00.
– Support is seen at 104.00, and a sustained drop below this region would signal potential for further retracement towards 103.00.
Traders should watch for major releases such as US GDP (second estimate) and PCE inflation data, both of which are likely to induce sharp moves.
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**EUR/USD Technical Analysis**
The euro has been relatively resilient in the face of the firming dollar, but faces persistent headwinds due to tepid eurozone growth and mounting political risk.
**Technical Considerations:**
– EUR/USD closed the week around 1.0810, after bouncing from the 1.0750–1.0775 support area.
– The 50-day moving average at 1.0860 is a key barrier to short-term gains.
– Immediate resistance lies at 1.0890. A break here would open up the path toward 1.0950.
– Downside support is situated at 1.0780 and then more decisively at 1.0720.
The pair’s upside potential may remain capped unless the European Central Bank signals a policy shift or US data significantly disappoints.
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**GBP/USD Outlook**
The British pound has benefited from surprisingly resilient UK economic data and the Bank of England’s hawkish undertones. However, the pair remains susceptible to broader global shifts and lingering Brexit aftershocks.
**Technical Outlook:**
– GBP/USD ended the previous session near 1.2675, holding a slight bullish bias above its 200-day moving average.
– Critical resistance is seen at 1.2740 and then 1.2820, with a clear break above confirming a sustained uptrend.
– On the downside, supports are at 1.2630 and, more importantly, at 1.2580, a breach of which might trigger a larger corrective phase.
Important data to watch next week includes UK inflation and PMI readings, both of which could influence the Bank of England’s forward guidance.
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**USD/JPY Analysis**
The Japanese yen continues to experience pressure, reflecting the wide US-Japan yield differential and the Bank of Japan’s ultra-accommodative stance.
**Technical Levels:**
– USD/JPY traded close to 151.10 toward the end of last week, a multi-year high.
– Should the pair break above 151.60, the door opens toward 152.50, where market chatter regarding BoJ intervention will likely intensify.
– Support is found at 150.35, with deeper pullbacks targeting the 149.60/
Read more on GBP/USD trading.