Trading Support and Resistance | DailyForex

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:

Trading Support and Resistance | DailyForex

Monthly Forecast May 2019

For the month of May, we again forecasted that the best trade will be short EUR/USD. The forecast’s performance to date is shown below:

Trading Support and Resistance | DailyForex
Last week, we made no weekly forecast. This week, we again make no forecast, as there were no large counter-trend price movements over the past week.

Weekly Forecast 26th May 2019

Only 4% of the important currency pairs and crosses moved by more than 1% in value over the past week. Volatility is likely to be similar over the coming week.

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

You can trade our forecasts in a real or demo Forex brokerage account.

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:

Trading Support and Resistance | DailyForex

USD/JPY

Let’s see how trading one of these key pairs last week off key support and resistance levels could have worked out:

We had expected the level at 109.81 might act as support, as it had acted previously as both support and resistance. Note how these “flipping” levels can work well. The H1 chart below shows the how the price rejected this level near the start of last Monday’s New York session (a great time to trade major currency pairs such as USD/JPY) turning bullish right away with a pin candlestick marked by the up arrow signaling the timing of the turn. This trade was profitable, achieving a maximum positive reward to risk ratio of more than 5 to 1 based upon the size of the entry candlestick.

Trading Support and Resistance | DailyForex

That’s all for this week. You can trade our forecasts in a real or demo Forex brokerage account to test the strategies and strengthen your self-confidence before investing real funds.

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