Get our trading strategies with our monthly & weekly forecasts of currency pairs worth watching using support & resistance for the week of May 3, 2021.
This week we will begin with our monthly and weekly forecasts of the currency pairs worth watching. The first part of our forecast is based upon our research of the past 18 years of Forex prices, which show that the following methodologies have all produced profitable results:
- Trading the two currencies that are trending the most strongly over the past 3 months.
- Assuming that trends are usually ready to reverse after 12 months.
- Trading against very strong counter-trend movements by currency pairs made during the previous week.
- Buying currencies with high interest rates and selling currencies with low interest rates.
Let us look at the relevant data of currency price changes and interest rates to date, which we compiled using a trade-weighted index of the major global currencies:
Monthly Forecast May 2021
For the month of May, we forecast that the USD/CAD currency pair will fall in value, and the CAD/JPY currency cross will rise in value.
For the month of April, we forecasted that the USD/JPY currency pair would rise in value, while the EUR/USD currency pair would fall. The final performance was negative:
Weekly Forecast 2nd May 2021
Last week, we made no weekly forecast, as there were no unusually strong counter-trend price movements in the Forex market. This week, we again make no forecast.
The Forex market showed an increase in its level of volatility last week, with 26% of the important currency pairs and crosses moving by more than 1% in value. Volatility is likely to rise over the coming week.
Last week was dominated by relative strength in the Canadian dollar, and relative weakness in the Japanese Yen.
You can trade our forecasts in a real or demo Forex brokerage account.
Previous Monthly Forecasts
Key Support/Resistance Levels for Popular Pairs
We teach that trades should be entered and exited at or very close to key support and resistance levels. There are certain key support and resistance levels that can be watched on the more popular currency pairs this week.