U.S. Dollar Forex Trading Forecast

Greenback in currency trading

The U.S. dollar forex trading forecast is long-term bearish, even though, in the short-term, the greenback has been showing a certain degree of strength. In currency trading, however, it is important to develop strategy based on the trends you see forming, depending on whether you are going for the long term or the short term. GFT’s Kathy Lien describes, in FX360, why the dollar is likely to be bearish in currency trading for the long term:

We are long term bearish dollars because we believe that the diversification out of dollars is not just a fleeting trend. Yet, central bank actions have the power to alter the outlook in the currency market especially in the short term.

The dollar appears to be weakening already today, after strengthening slightly on the news out of the euro zone about the ECB interest rate decision. However, the euro is recovering from that, and is up slightly right now in forex trading. For the long term forex trading forecast, it is important to remember that dollar weakness is likely to continue.