Forex Trading in 2021 – What to Expect?

2020 has been a hard economic year. Few are the sectors which haven’t felt the aftermath of the pandemic – and in that sense, the online forex trading industry is no different. When national economies started slowing down, and their currencies weakened accordingly, investors tended to shy away from currency exchange as a means of trade – if literally nothing is certain, why should traders risk their hard-earned cash and not put it somewhere else?

However, 2020 is behind us and that brings two developments: On one hand, control over the disease is not wishful thinking anymore and mass vaccination is underway. On the other hand, there is a realization that COVID-19 isn’t going to disappear, and that humanity will have to live alongside it. Will these two factors be enough to get forex trading back on track? Let’s try to analyze the prospects for 2021.

Bye-bye for Bitcoin?

One very dominant shift in the trading industry was toward cryptocurrencies. All other venues felt the blow: stocks, commodities, indices and forex. People saw a safe haven in crypto coins, and especially in Bitcoin, since they are much less dependent on national economies for their success. This started a snowball effect, since more investors in crypto meant rising rates, attracting even more investors subsequently.

Just like it rose, it can also fall.


Most analysts agree that this bubble has become a bit too big for its own good, and when it bursts – it might be painful. Keep in mind that while predominant crypto coins such as Bitcoin and Ethereum were climbing, not all other coins reaped the same fruits, so the psychology behind this trend is more complex.

However, even once things become more balanced and investments start making their way back to other venues, the crypto market is going to stay a step ahead of the rest. In other words, investors will shift their gaze back to forex (and some already are doing so), but things won’t be the same, regarding the division of traders’ attention.

When the going gets tough, the tough get going

National economies reacted differently to the virus, that’s clear by now. Hence, currencies were hit in different magnitudes by it. So even when the world completely bounces back, there’s going to be a certain sentiment toward the nations and governments which handled the situation better. These nations will enjoy a more favorable reputation from investors – generally speaking, not just when it comes to forex.

Take Taiwan for example. Being one of the first countries to be exposed to the virus, due to its location in the Far East, authorities took very quick measures to prevent havoc. Today, despite a population of almost 30 million people living on the island, Taiwan has reported only seven deaths from the virus. You can be sure that investors will remember the way the government handled things when we’re behind this. While the country has issues with attracting foreign capital due to its problems with China, the New Taiwan Dollar will certainly enjoy traders’ trust in the next year.

Bolder, braver, more dangerous

Forex trading scams have been a part of our lives ever since forex trading went online, and they’re not going to disappear soon. On the contrary, since more people do commerce and trading online these days, the crooks and scoundrels see more potential. That’s why they’re expected to double their efforts at finding victims and stealing their hard-earned money.

The battle between the bad and good guys, in this sense, will focus on who has the better technological means – the scammers who work online or the tech experts who try to locate them and bring them to justice. In this battle, our bet is with the good guys, since they have better tools and financial sources to upgrade the way they work. This means that criminals are going to try harder to snatch your money from you – but every mistake they make on the way will make it easier to turn the tables on them.

Trading scams - definitely something to be aware of in 2021.


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