Forex Trading Tendencies: What to Expect in 2020-2021?

This year has all the chances to become a historic one for all the financial markets, and the Forex market is not an exception. As per 2020’s trends, not only those who have access to insider information have a high probability of large-scale earnings. Ordinary traders with a high-quality trading terminal and a limited number of trading assets can generate a decent capital as well. According to experts, the daily turnover of the foreign exchange market will reach $10 trillion, which indicates the growing interest from investors in the market and in trading in general. Let’s take a look at the top three currency trends that will definitely affect your trading strategy.

#1 - How to Trade the US Dollar in 2020-2021?

Since 2017, the US dollar has shown a stable uptrend thanks to the actions of the US Federal Reserve. However, in 2019, the policies of US President Donald Trump and the scandals around him dramatically shaken the position of the national currency. At the same time, the current year ends with the prospect of the future settlement of trade conflicts with China. This means that the strengthening of the position of the US national currency is expected.

The US Central Bank adheres to the tactics of making decisions based on the release of important data for the country. Thus, short-term volatility in the dollar will be observed when important information is released on inflation, retail sales, and employment indicators. Trading at this time will be available only for those who are not afraid to take risks. In general, Forex investors are preparing for the strengthening of the dollar in 2020-2021.

#2 - How to Trade the Euro in 2020-2021?

The single European currency has celebrated its twentieth anniversary. After the 2008 crisis, the EU Central Bank developed a program to stimulate the eurozone economy by purchasing assets. After the program closure in 2018, traders had concerns about whether the Euro will be able to continue its development without additional stimulation or that the Forex trend will go down.

As before, the best way to speculate on the Euro is trading the Euro/Dollar currency pair. It is assumed that the price of this asset will move in a downtrend at least for some time. These trends in the Forex market will provide good opportunities for making money on short positions, while both long-term and short-term strategies can be used.

#3 - How to Trade the British Pound in 2020-2021?

As for the British pound, its rate is in a sideways movement so far, but everything can change rapidly after the early parliamentary elections in the UK and the completion of the Brexit procedure. These events in any case will have a negative impact on the Euro. So, keep an eye on the political situation in the country to immediately react to market changes.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes