 Hi, my name is Leo Roeb currency trader and trading coach at trading 180.com We're welcome to this week's supply and demand for us and gold fundamental and technical analysis now. I received a Comment on YouTube from a trader who said fundamental analysis never works for the simple reason that the market Usually prices in all the fundamental news even before it happens If you are relying on mainstream media for your fundamental news You are trading using still news and news that has already been priced in and it's a common sentiment I guess from traders who don't really understand how to Trade fundamental and resentiment analysis and at the end of this video. I'm going to give you my thoughts and really explain You know kind of how the market works from a very from a different view in terms of the fundamentals and How the market prices in and why the market prices in and how you can actually get ahead as well of and trade in alignment with the institutions and not necessarily wait for the for the news right in but for the sake of this video, I tend to look at news which is Obviously what happened? But also if you actually, you know Tend to kind of listen to maybe my analysis. You can kind of see my where my bias is going. Anyway, of course I can't share everything that I that I know in these in these weekly videos But some and also as well I can't offer financial advice, but I will share my thoughts on on this quiet common thought and Comment on comment on YouTube. Anyways getting into The week ahead Third at April it will be a busy week in the US with non-farm payrolls job jobs openings ISM services and manufacturing PMI and external trade data taking the central stage So busy week in the for the US data also inflation rates will be released for Switzerland and central banks in Australia, New Zealand Will decide on the course of monetary policy finally PMI figures are set to show the state of manufacturing the manufacturing sector in China and Canada Spain and Italy and so that would be important as well the PMI figures Everyone's pretty much watching that because there's a China trade idea, which is basically if China Start to grow and their economy starts to grow Then it can lift the global economy as China is really the world's economic engine And so if China starts to grow then It has a knock-on effect and affects other currencies and countries and currencies especially countries that are geographically close to China and also do a lot of trade with China like for example, the Australian economy and New Zealand as well. So if China starts to grow then it will affect certain currencies more than others And so yeah, China is definitely something to watch and so you can also Read the paragraphs, but I'll just read basically the summary and get into this week's fundamentals and some technicals to start off on the dollar index and a dollar index again It's just a measure of dollar strength against the basket of currencies like the euro the pound and the yen and I keep my eye on a dollar index just to kind of show me what the you know dollars strength weakness from a technical perspective But I'm also obviously driven by fundamental analysis, right? So from a fundamental perspective my bias actually is is short on the on the dollar for now I do think that there is a an opportunity to buy the dollar in this very short term But over the next maybe through I would say probably three to six months. I Conceal a dollar devaluing so on any pullbacks I'm looking for actually short rates and the feds feds William says policy will be driven by data amid uncertainty, so whether the Federal Reserve hike continue to hike or actually pause early It will be data driven and and so the Federal Reserve officials say they are keeping a close eye on the effects of Recent banking turmoil on the economic outlook as they weigh how much further to raise interest rates So they still are on the hiking cycle But that is likely to come to an end sooner if the data doesn't support rate hikes So comments on Friday from the New York Fed President John Williams and Fed Governor Lisa Cook also echoed remarks from three regional Fed presidents this week that policymakers will keep Up their efforts to bring down inflation, which is one of their mandates Which remains far above their goal in the economic outlook Is uncertain and our policy decisions will be driven by the data and the achievement of our maximum Employment and price stability mandates Williams said Friday during an event organized by huge Cetonic Community College in Bridgeport, Connecticut, and so Ultimately, yes inflation is still above their 2% target Data did come out yesterday inflation tar inflation readings did come out yesterday on I say yesterday, but it was on Friday But basically Inflation is coming down measures of inflation are coming down as well So as inflation starts to come down the Fed are less likely to continue hiking and so I do think in the short term There could be a maybe a price pullback, but I think value wise I do think that price should want to go lower on the dollar or it could obviously You know continue to go lower, right depending on the data if the economy is coming out and Again inflation measures are continuing to actually Slow down and lower towards a 2% target Then I can see the dollar actually continuing to drop if inflation measures come out Higher than the Fed are likely to be have to be a bit more hawkish but overall I think the dollar is a Cell at least over the medium to short term, but there are opportunities to look for potentially if you want to anyway Buying opportunities, but the data has to support that narrative Dollar yen, and I'm actually in this trade I've got in on Friday and this is now at least a break-even trade took some partial profits And so I'm hoping that prices will continue to go to the downside as the dollar gets weaker also as well The Fed are hiking soon to pause and actually the Bank of Japan are holding rates and possible yield curve adjustments your curve control adjustment and what that is is a Monetary policy they're basically changing the monetary policy And that should appreciate that the Japanese yen now nobody knows exactly when it's you know going to happen it could happen between you know now and June and the Bank of Japan actually came out and said that they're not going to announce When they're going to do it in terms of they're not going to forecast They're just going to do it as far as they're going to surprise the market rather than telegraph and so I think once they do and the market expectation is that they will have to adjust your curve control at some point I do think that the dollar yen Should want to go down to at least and revisit these lows. So let's see what happens here So we did have prices pulled back to this supply zone. That's really where my bias is and Managed to get in on an intraday stop hunt which came up into the Supply zone and as I said before I'm actually break even on that trade now. So definitely can't lose if you are looking to buy the dollar Then there is an opportunity to buy at these areas here. In fact, probably would pretty much or it there To theirs or they've made high highs higher lows and then you've also got that absolute lows which is Down at these areas here. So There is an opportunity to buy the dollar if there is some good news of prices do pull back during the week and Prices come down here and there is some positive news for the dollar Then in fact that is a decent buying opportunity at the one three ones down to maybe the one two nine six fours Moving on to the dollar Swiss Not necessarily a pair. I'm interested in the Again from a central bank perspective the Federal Reserve hiking rates Assumed to pause and also the Swiss National Bank are hiking rates and also soon to pause and so Yeah, in a risk-off environment, you would think that maybe the Swiss National Bank might be a slightly ahead of the Fed simply because The Swiss franc is typically a risk-off currency and if you know, the banking crisis does start to Heat up again and there are more banks That are in problems Then I think the the money should flow probably more into the Swiss franc and especially depending on where the bank Actually is in the world, right? So if they come if it's coming from for example, you know, the United States then Obviously money's gonna flow out of the dollar, right in terms of why would you put money into the buy the dollar when the Origin of the risk off and the crisis is actually originating in the US, right? And so money will probably typically flow into the Swiss franc and so what you're looking for are pullbacks Right pullbacks into maybe a zone that you're comfortable with decent pullback into not 92 60s If you can get that and then look for any kind of buy trades In terms of In terms of buying Again buying the dollar if prices do come down to these areas and the absolute lows then that's decent But if you look to the left, you've seen that this is this area has been touched once already And typically what you want to do is buy at the first, you know touch of a demand zone Is that's where really the bargain prices is are right? It was a bargain here prices went to the upside prices came down It was a bargain again prices went to the upside right and so the more times a level is touched the less of a bargain It becomes because everyone can see it now And so and so yeah, it's for me It's not the best trade in the world to take but it's decent if you do get a catalyst of some decent news for the dollar dollar CAD dollar CAD has been a bit of a surprising one, I think In terms of central banks you have the Federal Reserve Who are hiking still so that should support the dollar at least in the in the short term But the Bank of Canada have actually paused rates and so Yeah, you're seeing this pullback. So if you do think that the the dollar is still worth a buy Then these are really the zones that you want to get involved in in terms of buying the The US dollar right you can buy the US dollar right now into that zone I think actually with the confluence of some horizontal support and resistance I think that level actually is quite quite a decent Area to look for buy trades if you want to buy the dollar that is I'm not really a buyer of the dollar if I was buying a dollar It probably would be against something like the Canadian dollar in this zone or in this zone if it comes down To the one three four sevens to one three four fours The Canadian dollar for me not really a buy and I understand oil is going you know higher and The Canadian dollar and oil are typically correlated. They're not correlated 100% of the time But I would really have to see a Really a drastic change in the Canadian economy for me to want to buy the The Canadian dollar and also as well I would probably want to see the Federal Reserve actually pause rates as well in order for me to want to buy the Canadian dollar against the The US dollar, but again, it's not really a pair that I'm interested in at all at the moment moving on to the New Zealand dollar US dollar and We've pretty much just really Gone auctioned right as far as you know Most people would say that this is more of a ranging market over the past Couple of weeks why surprises have maintained this this auction and this range And so for me again, not really a pair I'm interested in I do think that this area This demand zone is a nice technical zone in order to look for any kind of buy trades if you're looking for short trades probably waiting for a Move back up into a fresher area of supply So you'd be wanting to buy the US dollar against the New Zealand dollar Then you're looking for a pullback up into this zone before looking at getting short But if you're looking to buy the New Zealand dollar based off of maybe some risk on maybe China Better data then expected then I think any pullbacks into this 61 area is going to be a really nice buy in terms of Riding the Chinese Reopening wave and again from a central bank perspective You've got two central banks that are hiking but soon to pause. So they're pretty much even when you see Central banks that are, you know, pretty much seen as Even then you will tend to get markets that move in an auction or what traders would typically know notice sideways moving and so getting into the the pound and The pound The pound has had a definitely reversal of fortunes right in terms of fundamentals from a from a from a Central bank perspective the Federal Reserve Obviously I can make soon to pause but the Bank of England have expected to pause but they are dependent right and in fact That has slightly changed now in terms of Because the data came out with inflation that was actually higher than expected. So I think the market is actually Gonna price is pricing in a 50-50 chance of an actual hike also as well. There was some decent news For the UK economy so UK firms report surgeon orders and made signs of economic recovery And so after UK narrowly misses recession IOD reports rise in business Demand confidence hiring and investment in March. And so yeah, there was recent GDP data that came out better than expected for the pound and so The pound you've seen that Continued really to kind of drive the pound higher against the dollar the better than expected news over the past a Few months I shouldn't say necessarily few months probably say maybe about a month or so and it's kind of caught the market including myself by surprise, right? There's a there's been a lot of unwinding of short Pound positions and so as the pound does better than expected it was actually expected to Go into a recession and now we've actually avoided a recession and you'll see in that reflected in Actually the pound strength across the board and so any pullbacks I think into this lower zone maybe the one two twos down into the one two one five Should be actually decent for a potential buy if you're looking to buy the pound dollar And so with the Fed Being a bit dovish. I think in the Bank of England being slightly more hawkish I think any kind of pullback especially maybe down into these lower zones I think they're going to be decent for a potential buy on the pound now Personally if would I be a buyer of the pound against the dollar probably I might it's something I'm watching it's definitely on the watch list and I would want to see some really good prices come back down You know, I mean for me to want to get long into more positive news out of the pound and some So not so good news out of the dollar, right? But I think your prices pulled back It may be it's worth a small position If you really want to understand the fundamentals and really how we go about You know looking at in-depth fundamentals I know a lot of people have been asking When does enrollment start when does enrollment start if you go to trading 180.com it starts on Monday the third of April So not long until you're able to join the mentoring group discord group and What you get in here really is top-notch fundamental and technical analysis. This was you know trade that we took the other day Which was the New Zealand cad and that was just showing You know trade as we spoke about this trade on our weekly call, which you're always invited to and Also, this is now profitable trade on the New Zealand cad So it's been a decent week also as well you get access to the fundamental analysis Spreadsheet, which I show you my bias on pairs whether I'm neutral on a watch list And whether I have a strong bias to go long or short on the pairs And also as well As well as many different things that you'll learn currency value cycle and really how to kind of use the spreadsheet in alignment with the Currency value cycle and why you should look to buy one twos or threes or actually sell Currencies that have ranked one two or three on the currency spreadsheet and why you can actually potentially buy a Currency that is ranked six seven or eight right And buy it But understanding obviously Forecasting and how the banks trade and looking for bargains, right? And so yeah, if you're interested Monday the 3rd of April is when enrollment opens. So getting back to the charts Euro-dollar and Euro-dollar a Lot of traders in fact in the group ended up getting involved in this trade Down here the 105s and they've actually have held up until these highs and so well done to them And that was spaced off of again just some fundamentals and understanding that the euro really was the currency to buy against the dollar and The Fed again, of course, they're hiking but the ECB European central bank are the most hawkish Central bank at the moment and so you're seeing that you saw a bit of a pullback, of course Which was due when you had this large move to the upside Of course, you're gonna get end up getting a pullback to some degree And so this was really the area that you want to look for any kind of long trades and so yeah, this is basically what's happened and But moving forward, I don't think anything's really changed from last week You've got a wide area of demand, but you also have again And basically what happened from last week's analysis prices obviously came down into that zone, right? Traders bought here as well in the group and it one two three four five days later We're back up at the highest right and so again, that was a really nice buying opportunity again If you look at last week's analysis This is basically what I was saying the top end of that if not then the One of six threes and then the absolute lows at the one of five twos And so prices actually did bounce off of that level of demand in conjunction with a nice area of support and resistance So nice nice trade there if you managed to get involved in that for the week Where do we go from here? I think probably the upside is capped. I think the market is waiting for The Fed, you know, obviously the data to come out And I do think that any pullbacks into any of these zones even deeper pullbacks are probably better buyers for the euro and again, you have to really watch the euro and Seeing what the central bank is doing and so From what I can see inflation is still high, right? So your area core inflation hits record back in case for ECB hikes And so consumer prices rise 6.9 percent on year core inflation at 5.7 percent ECB rates set as have zeroed in on underlying price trends. And so yeah, we still got, you know Problems with inflation and so You know, it says what Bloomberg economics says the March inflation reading adds to the adds to the case for Additional tightening or rate hiking from the ECB that follows comments from even dovish policy makers about the need for further hikes now that stress is stress in the banking sector has receded so Yeah, you see and obviously even dovish members of the ECB become hawkish and so the ECB is, you know, Lighted to continue to be the most hawkish central bank in terms of rate hikes and getting inflation down So that should want to help and support anyway the the euro If it does pull back to these deeper levels especially against the the the dollar Australian dollar US dollar and Yeah, it's the Aussie. I think is a decent buy of prices coming back down to this 0.65 cent area the Australian dollar actually are expected to pause rates on Tuesday But it's a bit of it's, you know, we were reading some bank analysis and a couple of them were saying that In fact, it might be a hawkish hold meaning that although they hold rates It's they're likely to potentially still carry on with rate hike So they haven't necessarily ended their hike, but again, that's obviously speculation if the RBA do come out and pause rates But their speech comes out as hawkish saying that they are made likely to resume rate hikes then you will see in fact the Australian dollar likely to increase in value and it won't don't know whether it would do it straight away No one knows if it will or if it won't go straight to the heavens or if it will pull back But if it's hawkish, it's likely to be supported and so That's what the market is looking towards. It's about the future rather than this is what traders tend to retail the average retail trader doesn't really understand fundamentals Tends to do is that they just wait for the rate hike and then try to press buy and That's really not how to kind of trade You know rate hikes you have to one of the things that you have to do is look at the actual speech and the Forward guidance as to what the central bank is likely to do and they're gonna tell you right They will tell you what they're gonna do. It might not be in the most simplest language in the world, but If you follow along, you know on maybe on Bloomberg or some other maybe another free some free websites news websites then Pretty much analysts will digest that information for you and then they will tell you pretty much what the central bank is Is likely to do in the future? So Again, I think decent pullback into a fresh area technically is a nice Potential buy again. I would really want to be a buyer against the dollar once the China reopening does start to come to fruition as well as the end of rate hikes for the Federal Reserve and finally gold and gold I think with a decline of the dollar Over the medium term any pullbacks. I think into this the demand zone 1913's to the 18 85 area I think it's going to be a really nice opportunity to buy gold if you've missed out on that buying gold opportunity and This was from ING talking about safe haven buying boost gold prices and so We look at The Fed policy and what they think is going to support gold and it's talks about It says the Fed policy is likely to be key for gold over the medium term The Fed is likely approaching a peak in Fed funds rates and we could see a pivot over the second half of this year recent events suggest that credit flows will become more restrictive and It says whilst we expect a pullback in prices in the short term Which is going to be lovely right a pullback in prices in the short term, right there We see gold prices moving higher over the second half of 2023 and expect Spot gold to average $2,000 an ounce over the fourth quarter of 2023 the assumptions around this are that we do not see Further deterioration in the banking sector and that the Fed starts cutting rates towards the end of the year and the reason why they would cut rates is because I think the market is Expecting actually the US to enter into a recession at some point this year as well. So Recession fears going to be good for gold in a risk-off environment So I say risk-taking environment but this golf more for the US economy and recession fears. So That should support gold. So again 2000s is the highs at the moment, right if any pullbacks I think that's going to be a very nice buy for gold Anyways guys, that's it for this week I do have the question to answer regarding fundamentals and You know everything being priced in says stay tuned. I'm gonna start answering that now So to the question and the statement really which is Fundamental analysis never works for the simple reason that market Usually prices in all the fundamental news even before it happens If you are relying on mainstream media for your fundamental news You are trading using stale news and that news has already been priced in now There are elements of this statement that I agree with definitely in terms of the market pricing in fundamental news typically before the data is released and if Retail traders are relying on mainstream media for fundamental news You are trading stale news and to a certain degree that that might be slightly true If they're if they're waiting for the actual news Release and the data release before trading then yes, typically You know the value of that currency and exchange rate has been priced in 100% but it but really I think there's maybe a bit of confusion in this which Because it's admitting that actually fundamental analysis Does work right because if you know the quest the statement is saying that the fundamentals have been priced in It's really just I guess not case of fundamentals not working. It's a case of Retail traders being behind the curve and so in terms of you know buying the rumor right and so Retail traders typically don't know how to get ahead of the curve or at least trade in line with the financial institutions And one of the things that you have to do first of all is understand GDP right the effect of GDP, right and So about a pencil GDP that's supposed to be a D Inflation right Right and the effect of GDP and inflation on Whether a central bank is likely to hike Hold or cut interest rates. I put INR What interest rates? because interest rates are one of the main factors of Giving a currency its value Yeah, and so once you can understand the data and the relationship between GDP and inflation and What the central bank is looking at because central bank ultimately will look at, you know, these main things As to whether they're likely to decide to hike Hold or cut. Yeah, then actually you can trade Ahead of the curve. Also a second thing is that when news is released Let's say for example, where foc comes out and the And the Federal Reserve You know, they high crates. Let's say by zero point two five percent Yeah Yes, that news has been priced it But what the market is also watching for and listening to more importantly because they've already priced in this 0.25 percent or 25 basis point, you know hike is They're looking at the speech right and what the future guidance and what the central bank Or banker or bankers are thinking right in terms of their their speech And so the speech is actually more important than the actual data. Most retail traders Won't You know read the speech or they won't look at mainstream media, right and their interpretation of What the speech is and one of the things you can kind of do to kind of filter What type of mainstream media you listen to is or read is Understanding or getting mainstream media that interviews analysts or Money managers and their opinions right because that ultimately is their opinions that matter And so if I'm you know, for example reading Bloomberg I'm going to read articles or look for articles where they are interviewing the experts You know about their opinions on what the speech meant in terms of whether the Federal reserve are hawkish Which would mean that they are potentially hiking rates whether they are you know or dovish, right? Which might mean whether they might be holding or cutting rates and so You have to really get the opinions of money managers Because they're not trying to be on mainstream media being interviewed to be wrong right regardless of what? You know rumors are peddled out there in terms of you know bankers misleading You know retail and there's obviously You know instances of that where you know You might have a bank that might say go long and then obviously things go the other way, right? There are instances of that but typically Analysts that are interviewed on Publications like the Financial Times, you know like Bloomberg have a different clientele, right? They have paying subscribers and they're not trying to mislead their paying subscribers otherwise they lose credibility And so when they're interviewed on these you know these these big Publications and shows and they say for example, well, we interpret the federal reserves statement to be quite hawkish For these reasons right and the reasons will typically be because it will tie back to what they're saying about future and expect their expectations on future GDP and inflation numbers Yeah, when they when they actually, you know Give their analysis. They're not trying to be wrong They're trying to keep their credibility intact so that you will then again read the next article and the next article Right, but Retail traders typically don't want to read they want the power for lease resistance Which is just looking at price and thinking that price is going to tell them Exactly what is going the news is going to do or price is going to do in the future when ultimately it's fundamental analysis Yeah, as we say, yeah that You know moves price Yeah Over the medium to long term now in the short term is something different. That's more liquidity, etc But I'm not going to get into that but ultimately It's really understanding the statement right is that it's not that fundamental analysis doesn't work It's understanding that retail traders are behind the curve now if you want to get an idea of how to Get ahead of the curve and understand GDP and inflation I Created about was it maybe about three years ago now Forex fundamental analysis full course You're a dollar strategy and under 16 minutes if you if you haven't watched this or if you have watched it I advise you to watch this again because I break down month-to-month using mainstream and now it mainstream media as well as data How I was my bias was short on a euro dollar for a whole year and how it worked out, right? so That's definitely something that you should watch as well as my fundamental analysis Playlist which is many of those videos as you can you start to connect the dots and so thank you for the question thank you for the statement and very interesting Statement and hopefully that clarifies things or at least starts to clarify things For you in terms of how the market works fundamental analysis works And the fact that you have to try to be ahead of the curve and understanding what is that moves markets in the first place? And that way you can be ahead of the curve More often than not all right guys take care and until the next video