Thursday , July 29 2021

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 on 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 date of currency price changes and interest rates to date, which we compiled using the trade-weighted index of the major global currencies:

table0120012019

Monthly Forecast January 2018

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

table0230012019

Weekly Forecast 20th January 2019

We made no forecast last week, as there were no exceedingly strong counter-trend moves. We do not have to do this week.

About 41% of the important currency pairs or crosses moved by more than 1% in value over the past week. Volatility has increased substantially and is likely to remain at a similar level over the coming week.

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

You can trade our forecasts in 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 close to key support and resistance levels. There are certain key support and resistance levels that should be watched on the most popular currency pairs this week, which might result in either reversals or breakouts:

table1220012019

GBP TO USD

Let's see how they traded two of these key pairs last week off key support and resistance levels could have worked out:

We had expected the level at 1.2918 might act as resistance, as it had acted previously both support and resistance. Note how these "flipping" levels can work well. The H1 chart below shows the price of this level just after the London close last Monday, marked by the down arrow at the price chart below, forming a bearish inside candlestick which broke down right before. Such candlesticks are often useful indicators of reversals when their wicks or the wick of the structure rejects key levels. This trade was profitable, achieving a maximum positive reward to risk ratio of more than 2 to 1.

AUDUSD "class =" IMG-RESPONSIVE "src =" https://dailyforex-a.akamaihd.net/files/AUDUSD.jpg "title =" AUDUSD

AUD / USD

We had expected the level at 0.7147 might act as support, as it had acted previously both support and resistance. Note how these "flipping" levels can work well. The H1 chart below shows how the price has been changed just after the London open last Thursday, marked by the up arrow at the price chart below, forming a bearish engulfing candlestick which broke the London session got underway. Such candlesticks are often useful indicators of reversals when their wicks or the wick of the structure rejects key levels. This trade was profitable, achieving a maximum positive reward to risk ratio of just under 4 to 1 so far.

GBPUSD "class =" IMG-RESPONSIVE "src =" https://dailyforex-a.akamaihd.net/files/GBPUSD.jpg "title =" GBPUSD

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


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