Trading Support and Resistance

Get our trading strategies with our monthly & weekly forecast of currency pairs worth watching using support & resistance for the week of January 3, 2022.

Advertisement

This week I will begin with my monthly and weekly forecasts of the currency pairs worth watching. The first part of my forecast is based upon our research of the past 20 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:

Monthly Forecast January 2022

For the month of January, I believe it will be wise to wait and see how the markets perform over the first week of this new year before making any forecasts.

For the month of December, I forecasted that the GBP/USD and EUR/USD currency pairs would fall in value. The final performances are shown below:

Weekly Forecast 2^nd January 2022

In my previous forecast last week, we made no weekly forecast, as there were no unusually strong counter-trend movements. Fading strong weekly counter-trend price movements is the basis of our weekly trading strategy.

We again make no weekly forecast, as there were no strong counter-trend price movements last week in the Forex market.

The Forex market saw a decrease in its level of directional volatility last week, due to the complete lack of any high-impact data releases, with only 30% of all the important currency pairs or crosses moving by more than 1% in value. Directional volatility is likely to increase this week as we begin a New Year and get FOMC meeting minutes and non-farm payrolls data.

Last week was dominated by relative strength in the Canadian Dollar, and relative weakness in the Japanese Yen.

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

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.

That is 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.