Currency Pairs to Watch in 2013
In the past year, most currency pairs have been relatively quiet, with volatility in historically low ranges. Forex trader Mike Kulej of FXMadness.com gives his overview of how he thinks a select group of cross pairs will fare this year.
We did not see major long-term trends develop, which many money managers blame for weak returns in forex trading programs. This period was still a consolidation, which followed dramatic developments of 2008-09. However, by now several currency pairs indicate that this market phase may be nearing completion, although the timing is subject of vagaries inherent to extremely long-term charts. Here is a quick look at the few that could start significant trends in 2013.
The GBP/JPY, or “beast”, has been a shadow of itself when compared to previous years. Still, in the past several weeks, its price started to move with more urgency. While well below its historically average volatility, the movement is currently accelerating, possibly completing a long-term rounded bottom. Additional progress from the current level of 140.60 would clear a major resistance level and likely mark the starting point of a new major rally. If this indeed happens, the GBP/JPY could remain in a bullish sentiment for some time, maybe even years.
The Aussie is in a little different predicament. Its rate with the US dollar has not made progress since May of 2011, although the current slowdown does not necessarily mark a major reversal.