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:

• 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’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 March 2018

For the month of March, we forecast that the best trades would be short USD/JPY and long EUR/USD. The performance to date is as follows:

Weekly Forecast 18th March 2018

Last week, forecasted that the AUD/JPY and CAD/CHF currency crosses would both fall in value. AUD/JPY fell by 2.52% and CAD/CHF by 2.11% so it was a very effective and profitable weekly trade.

This week, we make no weekly forecast, as there were no strong counter-trend movements this week.

This week has been dominated by relative strength in the Japanese Yen, and relative weakness in the Canadian Dollar.

Volatility was the same as it was last week, with approximately 41% of the major or minor currency pairs changing in value by more than 1%. Volatility is likely to be higher next week.

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: