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 11 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 May 2016

This month, we forecasted that the best movements will be short USD/CAD and USD/JPY, and long EUR/USD. The overall performance so far has been negative:

Weekly Forecast 15th May 2016

Last week, we made no forecast.

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

This week has seen strength in the U.S. Dollar and Swiss Franc, and weakness everywhere else, especially in the Japanese Yen. Stocks are also falling.

Volatility was much less than it was last week, with about 81% of the major and minor currency pairs changing in value by less than 1%. Volatility is likely to be considerably higher over this coming week.

Key Support/Resistance Levels for Popular Pairs

At the FX Academy, 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:

USD/CAD