Trading Support And Resistance - Sunday, May 16

10 and one 10 us dollar bill

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:

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:

Currency Price Changes and Interest Rates

Monthly Forecast May 2021

For the month of May, we forecast that the USD/CAD currency pair would fall in value, and the CAD/JPY currency cross would rise in value. The performance so far has been positive:

Monthly Forecast May 2021

Weekly Forecast May 16

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 a reduced level of volatility last week, with 19% of the important currency pairs and crosses again moving by more than 1% in value. Volatility is likely to remain relatively low over the coming week.

Last week was dominated by relative strength in the British pound, and relative weakness in the Japanese yen.

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.

Key Support and Resistance Levels

Let us see how trading reversals from one of last week’s key levels would have worked out:

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