The broader foreign exchange market enters February with a tone that feels balanced yet cautious. U.S. dollar sentiment is fragile, pressured by recent weakness and speculation around monetary policy direction, while safe-haven currencies like the Japanese yen have rallied sharply. Central banks’ policy stances in Europe and the UK are expected to remain broadly steady over the coming week, while labour market data from the United States stands out as the biggest macro event risk. This blend of geopolitical noise, softer dollar dynamics, and important economic releases sets up a week that could see heightened volatility and directional shifts for major currency pairs.
Last week, a notable shift occurred in the Japanese yen, which strengthened significantly against the U.S. dollar as traders began unwinding short positions and speculating about possible coordinated intervention by authorities to support the currency. This move contributed to broad dollar weakness and lifted other currencies such as the euro and pound. Meanwhile, financial markets digested mixed macro signals from the United States, with the dollar index hovering near multi-month lows and traders eyeing forthcoming labor data as a key catalyst for the near-term outlook.
The table below summarizes the most impactful macroeconomic events scheduled for the coming week. Times are generally in local market context.
| Day | Key Macroeconomic Events and Focus |
| Monday | ISM Manufacturing PMI, ISM New Orders Index, and ISM Prices Paid Index from the United States are scheduled for release during the U.S. morning session. These reports offer an early view of factory activity, demand conditions, and input cost pressures. Markets typically use this data to reassess growth momentum at the start of the month. |
| Tuesday | JOLTS Job Openings data from the United States will be published in the morning. This release is closely watched as it reflects labour demand and hiring appetite, which remain critical for evaluating wage pressures and broader employment conditions. |
| Wednesday | ADP Employment Change figures are released during the U.S. morning, offering a private-sector preview ahead of Friday’s official jobs report. Later in the same session, U.S. Services PMI and ISM Services PMI data are due, providing insight into the dominant sector of the U.S. economy. In Europe, preliminary Eurozone consumer inflation figures are also expected late morning. |
| Thursday | The Bank of England announces its monetary policy decision during the UK morning, followed by its policy statement. On the same day, the European Central Bank delivers its interest rate decision and forward guidance during the European session. These events are likely to influence sterling and euro volatility. |
| Friday | The U.S. Nonfarm Payrolls report is released during the U.S. morning, alongside the unemployment rate and average hourly earnings data. Shortly afterward, U.S. consumer sentiment figures are published. This combination often defines short-term dollar direction and risk appetite heading into the weekend. |
The focus is squarely on U.S. labor data and central bank decisions in Europe and the UK that could underpin broad currency moves.
The following technical snapshot reflects where the market stands as this new week begins.
The market’s technical structure suggests that key psychological levels (1.18–1.20 for EUR/USD and 1.33–1.36 for GBP/USD) may act as magnets for price action, while USD/JPY remains in a lower range following the yen’s recent advance.
| Pair | Trend | Support | Resistance | RSI Condition |
| EUR/USD | Mixed, slightly bullish above 1.1825 | ~1.1825 | ~1.2000 | Neutral to slightly oversold bounce |
| GBP/USD | Slight uptrend but volatile | ~1.3350 | ~1.3650 | RSI near mid–range |
| USD/JPY | Corrective downtrend after recent sell-off | ~153.0 | ~156.5 | RSI showing recovery potential |
We expect volatility into Friday’s Nonfarm Payrolls release, which is often a market-moving event that could define directional bias for the rest of the month.
| Pair | Bias | Support | Resistance | Comment |
| EUR/USD | Slight bullish | 1.1825 | 1.2000 | Weak dollar backdrop could lift the pair |
| GBP/USD | Neutral to bullish | 1.3350 | 1.3650 | Central bank expectations may influence trend |
| USD/JPY | Bearish tilt | 153.0 | 156.5 | Strong yen momentum remains a theme |
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