Archived EUR/USD Weekly Analysis – February 2026

Overview#

EUR/USD had extended its rally from 1.0850 to 1.0920 in the week preceding publication, gaining roughly 70 pips. Softer-than-expected US retail sales had pressured the dollar, while comments from ECB board member Isabel Schnabel supported the euro at that time.

At publication, the pair sat just below the 1.0950 resistance ceiling. The original article treated a breakout or rejection there as the defining scenario for the remainder of February 2026.

Technical Analysis#

Support and Resistance Levels#

• Strong Resistance: 1.0950 – Key resistance tested since December
• First Resistance: 1.0920 – Last week's high
• First Support: 1.0850 – 50-day moving average
• Strong Support: 1.0780 – Rising trendline

Key Chart Patterns#

On the daily chart used at publication, EUR/USD was forming an ascending triangle with higher lows converging toward flat 1.0950 resistance. The apex fell in the second half of that historical week; the eventual outcome must be checked against subsequent data.

On the 4-hour timeframe, the pair trades within a rising channel with support near 1.0860 and resistance near 1.0940. A break above the channel would align with the triangle breakout and reinforce the bullish case toward 1.1000.

Indicators#

RSI (14) reads 58 on the daily chart, maintaining bullish bias without entering overbought territory. A move above 60 alongside a break past 1.0950 would confirm buying momentum.

MACD histogram is positive and expanding above the signal line. The MACD line crossed above the signal line in early February and the spread continues to widen, signaling accelerating upward momentum.

Bollinger Bands are narrowing on the daily timeframe, with bandwidth at its lowest since early January. Tight bands historically precede sharp directional moves — traders should prepare for increased volatility once the squeeze resolves.

Moving Average Analysis#

All four EMAs are stacked in bullish order (20 > 50 > 100 > 200) with price above all of them. The 20 EMA at 1.0895 acts as dynamic intraday support. As long as the pair holds above the 50 EMA at 1.0852, the medium-term uptrend remains intact. A daily close below the 100 EMA would signal a structural shift toward bearish territory.

Fundamental Analysis#

Calendar listed at publication:

• Tuesday: US Consumer Confidence Index — Consensus expects a slight decline to 104.5 from 105.3. A weaker print would weigh on the dollar.
• Wednesday: Eurozone CPI (Flash Estimate) — Markets forecast headline inflation at 2.3% YoY. A higher-than-expected reading strengthens the ECB's hawkish stance and supports EUR.
• Thursday: US Q4 GDP (Revised) — The preliminary reading came in at 2.4%. An upward revision would be dollar-positive; a downward revision adds to growth concerns.
• Friday: US Personal Consumption Expenditure (PCE) — Core PCE is expected at 2.7% YoY. This is the Fed's preferred inflation gauge and the most market-moving release of the week.

The PCE inflation data will be decisive for Fed rate decisions. A core PCE print above 2.8% would push back rate-cut expectations and strengthen the dollar, while a reading at or below 2.6% would revive hopes for a June cut and pressure the greenback.

Dollar Index (DXY) Correlation#

EUR/USD and the Dollar Index (DXY) share a strong inverse correlation (typically -0.92 to -0.98). Last week DXY pulled back from 104.20 to 103.80, directly supporting the EUR/USD rally. A clean break below 103.60 would likely accelerate EUR/USD toward 1.0950 and beyond. If DXY rebounds and reclaims 104.20, expect selling pressure on EUR/USD toward 1.0850.

Trader Sentiment#

Retail positioning data shows approximately 62% of retail traders are net short EUR/USD — a contrarian bullish signal, as retail crowds tend to fade trends.

On the institutional side, the latest CFTC Commitment of Traders report shows asset managers increasing net long euro positions by 8,200 contracts to 143,600 — the highest in three months. The alignment between contrarian retail signals and institutional accumulation reinforces the bullish technical setup.

Historical Scenario Framework Used That Week#

At publication, the ascending triangle and bullish moving-average alignment supported the following conditional scenarios. These expired with that trading week and are retained only to show the original analytical framework.

• Historical bullish condition: The article defined a daily close above 1.0950 as confirmation, with 1.1000 and 1.1040 as scenario levels.
• Historical bearish condition: It defined a daily close below 1.0850 as invalidation, with 1.0780 and 1.0720 as scenario levels.