Weekly Currency Review: Major World Currencies Struggle Amidst Economic and Political Turmoil


  • The British Pound’s worth dropping against major world currencies due to “dragging-out” of Brexit
  • Lack of confidence in Balsonero’s Brazil is reflected weak Brazilian Real performance 
  • CNY prepared to hit seven-to-one ratio against the US-dollar for the first time since April 2008 amidst Trump’s trade war against China

Brexit Bodes Ill for GBP:

According to poundsterlinglive, “The British Pound finds itself under pressure once more in the approach to the end of what has been a tough month for the currency”. The month of May has not been a good one for the pound, as analyst Neil Wilson at Markets.com put it, “The Pound just can’t catch a break. No-deal Brexit fears continue to weigh on Sterling, whilst Dollar strength looks to be the catalyst for dragging it lower”. Germany just announced its veto to further any Brexit extensions, putting added pressure on Parliament. GBP/USD fell by 2.26% in the one-month range of last week’s forecast, as correctly predicted by I Know First’s algorithm.

BRL is in Trouble – No Light at the End of the Tunnel

The rising concerns of the political dissatisfaction and instability in Brazil has manifested in yet another month of rising USD/BRZ ratio. Brazil’s Chamber of Deputies President Rodrigo Maia says that the strained relationship with President Balsonaro and the fact that the government often blames pension reform for the country’s ills is not helpful to solving the country’s problems. He voices fears that the country is headed in the direction of social collapse.

USD/BRL increased by 1.16% in the one-month range forecast, as correctly predicted by I Know First’s algorithm.

China’s “Economic Growth Miracle” May Be Put On Hold

The yuan appears to be creeping up to 7 Yuan per 1 USD. June is projected to be a tough month ahead for the Chinese Yuan as trade war instability drags on for the foreseeable future. Chinese citizens have been feeling the effects of the US-China trade war for months, seeing noticeable increases in the prices of food, especially US-imported fruits and pork.

USD/CNY increased by 2.76% in the one-month range forecast, as correctly predicted by I Know First’s algorithm.

On 28th April 2019 I Know First algorithm issued bullish predictions for currencies for a month time horizon. The predictions include GBP/USD (British Pound to US Dollar), USD/BRL (US Dollar to Brazilian Real), and USD/CNY (US Dollar to Chinese Yuan) with signals ranging from -0.37 (GBP/USD) to 0.80 (USD/BRL) with predictability indicator ranging from 0.32 for USD/CNY to 0.53 for USD/BRL. Over the month-long trading period from 28th April 2019 to 29th May 2019, the currency market was in good agreement with the I Know First forecast.
This bullish currencies forecast was sent to the current I Know First Subscribers on 28th April 2019.

How to interpret this diagram

Algorithmic Currency Forecast: The table on the left is the forex forecast for the forex outlook produced by I Know First’s algorithm. Each day, subscribers receive forecasts for six different time horizons. Note that the top 52 currencies in the 1-month forecast may be different than those in the 1-year forecast. In the included table, only the relevant currencies have been included. The boxes are arranged according to their respective signal and predictability values (see below for detailed definitions). A green box represents a positive forecast, suggesting a long position, while a red represents a negative forecast, suggesting a short position.
Forecast Performance: The table on the right compares the actual currency performance with I Know First’s prediction. The column titled “Forecast” shows which direction the algorithm predicted, and the column “% Change” shows the actual currency’s performance over the indicated time period. The “Accuracy” column shows a “v” if the algorithm correctly predicted the direction of the stock or an “x” if the forecast was incorrect. The “I Know First Hit Ratio” represents the algorithm’s accuracy when predicting the trend of the currency.
Signal: This indicator represents the predicted movement direction/trend; not a percentage or specific target price. The signal strength indicates how much the current price deviates from what the system considers an equilibrium or “fair” price.
Predictability: This value is obtained by calculating the correlation between the current prediction and the actual asset movement for each discrete time period. The algorithm then averages the results of all the prediction points, while giving more weight to recent performance. As the machine keeps learning, the values of P generally increase.

View More Currency Forecasts

Algorithmic traders utilize these daily forecasts by the I Know First market prediction system as a tool to enhance portfolio performance, verify their own analysis and act on market opportunities faster. This forecast was sent to current I Know First subscribers.

Please note-for trading decisions use the most recent forecast. Get today’s forecast and Top stock picks.

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