If you feel ready to end the winter holidays, and start trading right away, take a while to comprehend the necessary knowledge dose first. 2021 will be very different from the previous tough years, and there are no signs of simplification. However, your success depends only on your approach and the freshness of information in your head. Here is the freshest listing of 2021 Forex trends that will help you to wake your account up without too much unpredictability.
Contents
Democratic Congress
In 2020, USD had as many as 8 declines over the last 9 months of the year. The reasons for that include the global surge in manufacturing activity and wane in financial stress from other currencies. The first weeks of 2021 revealed that depreciation continues. The victory of the Democrats means that more stimulus payments are to be made. The new Congress voted for $900 billion of additional stimulus for states and households, which made more USD weaknesses real in the nearest future.
Still, we don’t know the actual timing for the stimulus, so a rough downslide can come unexpectedly. The support for the greenback may come from the vaccination process that gains momentum meanwhile. On the other hand, we lack transparency of vaccine efficiency and distribution, so the only option is to wait for updates.
Brexit Deal Outcomes
Based on the contents of the new UK-EU Brexit deal, the chances of supply chain disruptions are very low, even in the worst scenario. At the same time, the UK has the most severe quarantine at the time because of the new virus strain. Other major countries of the EU are also taking measures, so the pressure on GBP and EUR grows, leaving traders and authorities in limbo. Carefulness with the British currency trading CFD strategies is necessary until the current situation gives any clear outcomes.
CAD Undervaluation
In 2020, CAD almost reached a 3-year high to the USD. Such an appreciation of the loonie is mainly due to the growing weaknesses of the USD. However, the Canadian currency has all the chances to keep strengthening against the US Dollar due to narrowing interest rate spreads. The current prognosis is that the loonie will trade for less than $1.25 against USD. The average value will most probably be $1.20, but the way to the plateau won’t be direct.
AUD Remains Strong
The recent strengthening of the commodity segment let AUD close 2020 on strong positions. Due to the low-interest rates in developed countries, Australia may use this occasion to pay more attention to bond yields and put more pressure on the sector without risks for the currency. The worsening of Australia-China relations didn’t create more risks for the currency due to the high level of independence of both economies.
EUR Overcomes Troubles
ECB still has little to do to prevent Euro from further growth in 2021, while the interest rates stay at the bottom. We still can’t say if the EUR/USD will surpass the 2018 highs, but the attention to USD problems will be very high during the entire year. The strengthening of the EUR can also lead to an upside trend against the USD and play a role in further weakening of the currency.
More on the Line
The year only begins, so many questions are still unanswered or unasked. Make sure to return to these pages for a fresh portion of well-researched financial news. A good Forex trader is a person who’s always aware of at least the main financial and political trends as it’s the only way to get the keys to a deeper understanding of this risky market.
