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 take a 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 August 2018
For the month of August, we forecast that the best trades will be short EUR/USD and short GBP/USD. The performance so far is as follows:
Currency Pair
Forecast Direction
Interest Rate Differential
Performance to Date
EUR/USD
Short ↓
2.00% (2.00% – 0.00%)
+1.01%
GBP/USD
Short ↓
0.75% (0.75% – 0.00%)
+1.93%
Weekly Forecast 19th August 2018
Last week, we made no forecasts, as there were no strong counter-trend movements.
This week, we again make no forecast, as there were again no strong counter-trend movements.
This week has been dominated by relative strength in the New Zealand Dollar, and relative weakness in the British Pound. Sentiment is mixed and unclear.
Previous Monthly Forecasts
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:
