Gold Rebounds as FX Holds Range (02.18.2026)

Markets traded with a mixed tone as currencies and metals reacted to central bank signals and fresh data. The euro held firm near $1.185, supported by the ECB’s comfort with currency strength and confidence that inflation is on track, alongside expectations of a less dovish policy mix later this year. 

The Japanese yen eased despite a sharp jump in exports, as traders balanced strong trade momentum against broader policy normalization expectations. Gold rebounded toward $4,900 on dip-buying, with investors weighing mixed Federal Reserve commentary ahead of key US data and FOMC minutes. Sterling slid to a two-week low after weak wage growth and rising unemployment strengthened the case for Bank of England rate cuts. Meanwhile, silver snapped a short losing streak as buyers returned, supported by expectations of eventual Fed easing and ahead of upcoming US growth and inflation releases.

ECB Stance Keeps Euro Firm

The euro traded around $1.185, remaining near its late-January peak of $1.20. Support comes from the ECB's apparent comfort with the currency's current strength. President Christine Lagarde noted that the inflation outlook is in a "good place," advising against reacting to temporary market shifts. Additionally, the impending June departure of Bank of France Governor François Villeroy de Galhau, seen as dovish, has provided further support for the single currency.

For EUR/USD, the initial resistance is seen at 1.1880, while the closest support is positioned at 1.1800.

Yen Eases Despite Export Surge

The Japanese yen weakened to approximately 153.5 per dollar on Wednesday, reversing earlier gains despite strong trade data. January exports rose at their fastest rate in over three years, fueled by intense AI chip demand. This strength supports expectations that the Bank of Japan will proceed with policy normalization.

Technically, resistance stands near 153.70, while support is firm at 152.50.

Gold Recovers Toward $4,900

Gold climbed to approximately $4,900 per ounce on Wednesday, reclaiming ground after a two-day decline as dip-buying surfaced. Markets weighed contrasting Federal Reserve commentary: Governor Michael Barr suggested maintaining current rates until inflation nearing 2% is certain, whereas Chicago Fed President Austan Goolsbee hinted at potential cuts later in 2026 if disinflation persists. Investors are now prioritizing upcoming FOMC minutes, GDP estimates, and PCE inflation data to clarify the central bank's next policy move.

Gold sees support near $4885, while resistance is around $5000.

Sterling Hits Two-Week Low

The British pound fell below $1.36 on Wednesday, reaching its weakest point since February 5. New labor market data showed average weekly earnings (including bonuses) rose by only 4.2% in the quarter ending December, missing forecasts and marking the slowest pace since mid 2024. Meanwhile, unemployment climbed to 5.2%, its highest level since early 2021. This cooling trend in wage growth and rising joblessness has strengthened market expectations for Bank of England rate cuts.

From a technical view, support stands near 1.3560, with resistance around 1.3600.

Silver Gains on Dip-Buying

Silver climbed to approximately $74 per ounce on Wednesday, snapping a two-day losing streak as buyers entered the market ahead of the Federal Reserve’s January meeting minutes. Despite recent hawkish comments suggesting rates may stay steady for now, investors still anticipate multiple cuts later in 2026 if inflation nears the 2% target. This outlook generally favors non-yielding assets like silver. While earlier dollar strength and softening geopolitical tensions previously dampened safe-haven appeal, markets are now awaiting upcoming U.S. GDP and PCE data for further direction.

From a technical view, resistance stands near $77.50 while support is located around $73.80.