April Forex Seasonality Key Points
- April has historically been the strongest month for GBP/USD, with the pair seeing an average gain of +0.66% since 1971.
- USD/CAD tends to struggle at the start of Q2, though the Canadian election at the end of the month may play a bigger role than seasonality this year.
- The budding trade war and developments on the tariff front could well outweigh the modest historical seasonal tendencies in April.
The beginning of a new month marks a good opportunity to review the seasonal patterns that have influenced the forex market over the 50+ years since the Bretton Woods system was dismantled in 1971, ushering in the modern foreign exchange market.
As always, these seasonal tendencies are just historical averages, and any individual month or year may vary from the historic average, so it’s important to complement these seasonal leans with alternative forms of analysis to create a long-term successful trading strategy. In other words, past performance is not necessarily indicative of future results.
Euro Forex Seasonality – EUR/USD Chart
Source: TradingView, StoneX. Please note that past performance is not necessarily indicative of future results.
Historically, April has been a modestly month for EUR/USD, with the world’s most widely-traded currency pair sporting an average return of 0.31% over the last 50+ years. In March, EUR/USD saw its biggest rally since November 2022(!), gaining more than 4% amidst fiscal stimulus in Europe and concern about a trade-driven slowdown in the world’s largest economy. Bulls will be watching for a confirmed break above resistance at the 2025 highs in the mid-1.0900s to open the door for an extended rally in the coming month.
British Pound Forex Seasonality – GBP/USD Chart
Source: TradingView, StoneX. Please note that past performance is not necessarily indicative of future results.
Looking at the above chart, GBP/USD has historically seen its best performance in April, with average returns of around +0.66% since 1971. Like the euro, the British pound also gained significant ground against the greenback in March. As long as cable holds above the 200-day MA (currently around 1.2800), the path of least resistance should remain to the topside as we begin Q2.
Japanese Yen Forex Seasonality – USD/JPY Chart
Source: TradingView, StoneX. Please note that past performance is not necessarily indicative of future results.
March has historically been a bearish month for USD/JPY, with the pair falling by an average of -0.18% since the Bretton Woods agreement, its second worst month in our sample period. USD/JPY edged lower in March, helped along by a modest safe-haven bid and expectations of a narrowing interest rate gap between the Bank of Japan and Federal Reserve. Traders will be watching the Fibonacci retracements of the H2 2024 rally at 147.00 (61.8%) and 143.75 (78.6%) as logical downside objectives this month.
Australian Dollar Forex Seasonality – AUD/USD Chart
Source: TradingView, StoneX. Please note that past performance is not necessarily indicative of future results.
Turning our attention Down Under, AUD/USD has seen relatively strong performance in April, with an average gain of 0.36% going back to 1971. Last month, AUD/USD bounced from support at multi-year lows near 0.6200 before fading back to near unchanged by the end of the month. For April, readers should watch for a break of the year-to-date range between roughly 0.6200 and 0.6400 to bring back volatility to the moribund pair.
Canadian Dollar Forex Seasonality – USD/CAD Chart
Source: TradingView, StoneX. Please note that past performance is not necessarily indicative of future results.
Last but not least, April has been a bearish month for USD/CAD, with an average historical return of -0.48%. While it can be useful to understand the historical seasonal tendencies in certain environments, the North American pair faces much more significant pressure from the health of its trading relationship with the US and a federal election at the end of the month, and those headlines may once again be a bigger driver for USD/CAD this month than the bearish seasonal trend.
As always, we want to close this article by reminding readers that seasonal tendencies are not gospel – even if they’ve tracked relatively closely so far this year – so it’s important to complement this analysis with an examination of the current fundamental and technical backdrops for the major currency pairs.
-- Written by Matt Weller, Global Head of Research
Check out Matt’s Daily Market Update videos on YouTube and be sure to follow Matt on Twitter: @MWellerFX
