Bullish Momentum Poised for Extended Duration as Technical Structure Holds Firm

Central Bank

Economic

Summary:

The histogram is printing bullish green bars with significant depth, and the signal lines are comfortably positioned above the neutral zone.

BUY EURUSD

EXP

PENDING

1.18450

Entry Price

1.20450

1.17450

1.19000 +0.00065 +0.05%

Pips

PENDING

1.17450

Exit Price

1.18450

Entry Price

1.20450

The European Central Bank (ECB) elected to maintain its benchmark interest rates during the February policy meeting, a decision that aligned perfectly with broad market expectations. However, the accompanying rhetoric possessed a notably more hawkish undertone, as the governing council emphasized the underlying resilience of economic growth within the Eurozone. President Christine Lagarde appeared to dismiss the significance of recent inflationary moderation and brushed aside concerns regarding the Euro's recent appreciation. She noted that the common currency remains well-situated within its historical average range, signaling that currency volatility is not currently a primary concern for policymakers.

Regarding broader economic activity, current estimates suggest that Eurozone GDP is on track to expand between 0.2% and 0.3% on a quarter-over-quarter basis, bolstered largely by robust domestic demand and a resilient services sector. Recent Purchasing Managers' Index (PMI) data indicates a narrowing performance gap between the Eurozone's core and periphery economies. While the manufacturing sector and industrial production continue to grapple with persistent weakness—exacerbated by periods of heightened volatility—analysts expect that fourth-quarter GDP figures will avoid downward revisions, despite the lackluster industrial output recorded in December.

Furthermore, final Composite PMI data for January suggests a marginal deceleration at the start of the fiscal year. Nevertheless, growth projections for the first quarter remain stable at approximately 0.2% inter-quarterly. Simultaneously, investor sentiment within the region saw a remarkable recovery in February. The Sentix Investor Confidence Index surged to 4.2, up from -1.8 in January. This represents the third consecutive monthly advance, marking the highest confidence level recorded since July 2025 and reflecting a significant shift in regional optimism.

Early Monday, economic advisor Kevin Hassett indicated that while somewhat softer labor market figures should be anticipated, a moderate cooling of the employment landscape should not trigger undue alarm among market participants. Following this, Federal Reserve Board of Governors member Stephan Miran joined the discourse regarding central bank independence, asserting that the Fed must preserve a significant level of autonomy from political pressures. He nuanced this perspective, however, by acknowledging that absolute independence remains practically unattainable in the current geopolitical environment. On the fiscal front, Miran underscored the benefits of full expensing policies, which provide a significant boost to economic activity. This mechanism allows corporations to immediately deduct the entire cost of productive equipment and machinery in the year of purchase, bypassing traditional long-term depreciation schedules.

Simultaneously, Fed Governor Philip Jefferson signaled that the central bank’s future policy path will remain strictly dependent on incoming data, maintaining a cautiously optimistic outlook supported by a 2.2% GDP growth forecast for the year. Jefferson reiterated that the Federal Reserve’s steadfast commitment to price stability is actively mitigating systemic risks. He further suggested that monetary policy is approaching a neutral stance, classifying the 2025 tariffs as a transitory adjustment to price levels. Meanwhile, the publication of January’s Nonfarm Payrolls (NFP) has been officially rescheduled to February 11th as a direct consequence of the partial government shutdown. Concurrently, the latest University of Michigan (UoM) survey points to a budding improvement in consumer sentiment, though the underlying data necessitates a vigilant interpretation. Survey director Joanne Hsu highlighted a stark structural divergence, observing that sentiment surged significantly among consumers with large stock portfolios, whereas it remained at discouragingly low levels for those without equity holdings. Bullish Momentum Poised for Extended Duration as Technical Structure Holds Firm_1

Bullish Momentum Poised for Extended Duration as Technical Structure Holds Firm_1

Technical Analysis

The EUR/USD pair has successfully resumed its primary bullish impulse after staging a technical rebound from the 100-period Moving Average on the 4-hour chart, currently situated at 1.1812.

The 200-period Moving Average is tracking closely at 1.1759, reinforcing this zone as a formidable dynamic support floor. Should the price return to these levels, we anticipate renewed buying pressure. Corrective retracements from the current peak should be viewed as strategic entry opportunities. Specifically, a retest of the 1.1844 zone—the level where the January 23rd gap found structural support—could offer a high-probability setup to rejoin the prevailing trend.

Our momentum analysis via the MACD suggests that a more extensive upward move is currently in development. The histogram is printing bullish green bars with significant depth, and the signal lines are comfortably positioned above the neutral zone. However, if the green bars begin to decelerate and lose volume, it would validate our thesis of a temporary mean reversion toward the support cluster before the next leg higher.

Our primary upside objective remains the 1.2045 handle, which aligns with the recent local peak. As long as the price maintains its integrity above the moving average confluence, the technical bias remains firmly in favor of the bulls.

Trading Recommendations

Trading direction: Buy

Entry price: 1.1845

Target price: 1.2045

Stop loss: 1.1745

Validity: Feb 20, 2026 15:00:00

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Risk Disclosure

The risk of loss in trading financial instruments such as stocks, FX, commodities, futures, bonds, ETFs and crypto can be substantial. You may sustain a total loss of the funds that you deposit with your broker. Therefore, you should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.

No decision to invest should be made without thoroughly conducting due diligence by yourself or consulting with your financial advisors. Our web content might not suit you since we don't know your financial conditions and investment needs. Our financial information might have latency or contain inaccuracy, so you should be fully responsible for any of your trading and investment decisions. The company will not be responsible for your capital loss.

Without getting permission from the website, you are not allowed to copy the website's graphics, texts, or trademarks. Intellectual property rights in the content or data incorporated into this website belong to its providers and exchange merchants.

Recent Searches

Top Searches

Markets

Analysis

User

24/7

Economic Calendar

Education

Data

Bullish Momentum Poised for Extended Duration as Technical Structure Holds Firm

Technical Analysis

Risk Disclosure