Market Analysis Summary - February 16, 2026

FTSE 100 Nears Record High

The FTSE 100 index is approaching its record high of 10,543, with a potential breakout above this level likely to target the 11,000 mark. Immediate resistance is noted at the February 4 high of 10,482, while support levels are identified at 10,429-10,426 and 10,379. The short-term outlook remains bullish as long as the index stays above the February 12 low of 10,211.

USD/JPY Finds Support

The USD/JPY currency pair has rebounded from a low of ¥152.27 after reaching a high of ¥157.72 last week. The pair is currently trading above this support level, with a target of ¥153.76 in sight. A fall below ¥152.27 could lead to a test of the late January low at ¥152.10. The short-term outlook is bullish while above ¥152.27, and neutral in the medium term as long as it remains above ¥152.10 but below the January peak of ¥159.42.

Silver Price Bounces Back

Silver prices are holding above a recent low of $73.9829, which is close to the January low of $73.8425. If these levels hold, there is potential for a rise towards the previous high of $79.3592. A break below $73.9829 could see prices test the late December and early February lows at $71.3157 - $70.0750. The short-term outlook is bullish while above the February 13 low of $73.9829, with a medium-term neutral outlook but a bearish bias above the February 6 low of $64.0626.

Macro Update

Asian markets are experiencing muted trading due to the Lunar New Year holidays, with Japan's Nikkei 225 up 0.2% and the MSCI Asia-Pacific ex-Japan up 0.4%. Japan's GDP growth for Q4 was disappointing at 0.2%, significantly below the forecast of 1.6%, prompting discussions for additional fiscal stimulus. US and European equity futures are slightly higher as investors await key economic data, including the US Q4 GDP release, expected to show a slowdown to 3.0% from 4.4%.

Market Sentiment

There is a notable decline in S&P 500 buybacks, down 7% annually, attributed to increased capital spending plans by hyperscalers, which have reached $660 billion. This shift is driving a rotation into defensive sectors like consumer staples, while software stocks have seen a 24% decline over the past three months. Bond yields are falling, with two-year Treasury yields at 3.41%, reflecting market expectations of a Federal Reserve rate cut in June.

Conclusion

The current market environment is characterized by cautious optimism, with key indices like the FTSE 100 nearing record highs, while currency and commodity markets show signs of stabilization. Investors are advised to monitor upcoming economic data closely, as it may influence market direction in the near term.