Week Ahead: Week 18, 2026
Technical Analysis: Pound/Japanese Yen (GBP/JPY)
Welcome to your weekly edge in the markets covering the latest news and price action with clear, actionable insights.
Japan's $34.5 billion currency intervention sent USD/JPY crashing from 160 to 156 in hours, the yen's sharpest rally since 2022. Brent broke back above $110, its highest since the war began, as the Strait of Hormuz remained shut. The Fed's most divided vote since 1992 and the ECB pricing in up to three hikes added to the hawkish backdrop.
Equity markets largely ignored it all as the Nasdaq hit consecutive record highs, capping the S&P 500's and Nasdaq's best month since 2020.
Chart of the Week
The chart shows every Japanese intervention since 2022 — and the pattern is consistent: each one triggered a sharp short-term drop in USD/JPY, but none reversed the longer-term uptrend. The yen kept weakening after every intervention, with the pair ultimately pushing to new highs each time.
What this means for the current intervention: the initial move from 160 to 156 fits the historical template precisely.
Source: Bloomberg
Week in Review
Geopolitics Talks to reopen the Strait of Hormuz stalled through the week. Reports that Trump was briefed on options to resume military strikes to break the deadlock sent Brent above $113 mid-week before it pulled back below $110 by Friday. Gold drifted lower from $4,700 toward $4,550 on the same reports.
Fed Held as expected but delivered the largest number of dissents since 1992, with three board members pushing for language that more explicitly acknowledged the risk of a rate hike. Markets took it as a hawkish signal, pushing 10-year Treasury yields toward 4.38%.
ECB A hawkish hold reversed the dollar's post-Fed gains. The ECB warned that inflation threats have risen materially, and futures markets now price as many as three hikes this year — with the first potentially as soon as June.
BOE Kept policy on hold but introduced deliberate ambiguity, outlining three war scenarios and noting that in two of them rate hikes would likely not be necessary. Sterling held firm relative to the euro as investors saw the ECB's hawkishness as the bigger growth risk.
BOJ Three of nine members voted to raise rates — a hawkish outcome — but insufficient to prevent USD/JPY from breaching 160. The subsequent intervention sent the pair crashing more than 500 pips to 156 within hours.
Earnings Alphabet jumped on blowout cloud growth; Microsoft and Meta slipped on less stellar results. Overall Q1 earnings are tracking 27.8% growth — the best since Q4 2021 — with over 80% of S&P 500 reporters beating estimates.
Latest Price Action
Source: FinViz.com
Week Ahead
US nonfarm payrolls (Friday) April payrolls are expected at 83,000 — a step down from March's strong 186,000 but broadly in line with the past year's trend. A second consecutive strong print would raise the odds of a Fed hike and could push gold toward $4,350. A weak number would revive labour market concerns and complicate the Fed's already divided stance. The unemployment rate is seen unchanged at 4.3%.
RBA rate decision Analysts expect a third consecutive hike as Australia faces high inflation and a resilient economy — even before the energy cost bump. The focus will be on whether the RBA signals a pause after erasing all of last year's cuts. AUD/USD is retesting 0.7200; a breakout could push it to four-year highs, while a rejection risks a slide back below 0.7100.
Middle East — escalation risk Trump was reportedly briefed on military options to break the stalled Iran negotiations. Monday sees thin liquidity with UK, China and Japan all on holiday, which could amplify any weekend developments in the Strait. Markets remain priced for a gradual resolution — a resumption of strikes would likely hit equities hard and send crude sharply higher from already elevated levels.
Economic Calendar
*** Highest Impact
Source: FXStreet
Earnings
Palantir / AMD / Arista / Arm / Walt Disney / Uber / Shell / McDonald's / Gilead / Enbridge
Technical Analysis
Pound/Yen (GBP/JPY)
Setup
Uptrend + failed breakout
- Big daily drop after topping 216 resistance
- Major support at 208.
- Still above rising trendline
- Price inside 20/50 day SMAs
- Price above rising 200 day SMA (uptrend)
Strategy
- Buy another push beyond 214
- Sell break below rising trendline
But - as always - that’s just how the team and I are seeing things, what do you think?
Share your ideas OR send us a request!
Cheers,
Jasper
Disclaimer:
The communication does not constitute investment or trading advice, nor does it include any recommendations. Additionally, it does not serve as an offer or solicitation to engage in transactions involving financial instruments. WeTrade does not take responsibility for any actions taken based on the information provided, nor for any outcomes that may occur as a result of the actions taken.
