Trading Support And Resistance - Sunday, August 18

This week we’ll 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 16 years of Forex prices, which show that the following methodologies have all produced profitable results:

Let’s 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:

table01

Monthly Forecast August 2019

For the month of August, we forecast that the best trades would be short GBP/JPY and short AUD/JPY. The forecast’s performance to date is shown below:

table02

Weekly Forecast August 18

Last week, we made no weekly forecast. We make no forecast again this week, as our weekly forecasts are based upon fading strong counter-trend movements, and there were no such movements over the past week.

The Forex market has become quieter, with less than 26% of the important currency pairs and crosses moving by more than 1% in value over the past week. Volatility is likely to be similar over the coming week, or maybe a little higher.

Last week was dominated by relative strength in the British Pound, and relative weakness in the Euro.

You can view the results of our previous monthly forecasts here.

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 should be watched on the more popular currency pairs this week, which might result in either reversals or breakouts:

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