 Hi, my name's Leon Rowe currency trader and trading coach at trading 180 comm welcome to this week's supply and demand Forex and gold fundamental and technical analysis. So let's get into the forex fundamentals for the week ahead starting November the 27th in the US so the week will be dominated by the releases of a PCE prices, which is basically a measure of inflation net the Fed keep an eye on personal income and spending ISM Manufacturing PMI's along with speeches from the Federal Reserve officials including chair Powell So additionally attention will be directed towards the CB consumer confidence and the second estimate of QQ 3 which is the third quarter GDP growth rate now the second estimate of the GDP growth rate isn't Necessarily a massive deal, but it has been seen. I think it's expected to be revised higher than the I think it was 4.8 or 4.9 that came in Initial initially from the preliminary. So the first Reading of Q3 and actually is meant to be higher, but let's see what happens, but it's not really necessarily a market mover Globally monetary policy updates will be on the horizon with interest rate decisions expected in New Zealand. That would be a big deal And accompanied by speeches from various central bank and Bank of Japan officials and again talking about the New Zealand dollar They're actually expected to hold Interest rates But the where the price may move is the expectation on whether the bank is either going to be hawkish or a bit dovish So it's really mainly about the speech If they don't hike or or cut rates is again, they're on a hiking cycle stroke holding cycle They're likely to hold but if they do hike that would be that should be positive and appreciate the currency October inflation rates are anticipated from Germany and again in the euro area and Australia again That's really important because it kind of sets the tone for monetary policy from central banks. So again with the euro area inflation is expected to come down and so what that does is is that that means that the central bank are less likely to hike rates and So the euro may start to actually depreciate in value as rate hikes taken off the table excuse me and Australia as well are in that a basket in terms of the news and inflation Moreover GDP growth rates will be unveiled for Canada and Switzerland and again that's going to be Definitely should be worth watching especially for anyone who is looking to buy or sell the Canadian dollar or the Swiss franc China focus will be on manufacturing and services PMIs Why is that important because it gives an indication of Chinese growth and economic growth and global growth. So if China are growing then in fact that could weigh on the dollar, but at the moment The Chinese economy is in a bit of a slump at the moment So let's see what happens if there's going to be any green shoots of recovery Additionally manufacturing PMIs will surface for Canada and Germany and again That's an indication of some economic growth and that will and Germany will publish. Sorry the GFK consumer Confidence and retail sales. So that's all from trading economics comm and so you can check that website out And they have to give a bit more detail on there and for those of you who are in the private mentoring group I have uploaded the weekly fundamental a technical analysis video Which goes into a lot more in-depth analysis on the fundamentals and the technical Pares that we're looking to trade based on the fundamentals. So that's available in the trading videos channel You can access that via the discord rooms. So as well as other videos as well like I put there's a video here, which is basically talks about why rate hikes can devalue a currency and GDP and inflation analysis. So it's not all the time that GDP and interest rate hike Will it result in appreciating currency and you have to know the environment when actually a rate hike Actually can devalue a currency and I talk about that in that video and also as well You've got Wednesday's group call. So as well as other many other videos that are in the That are in the channel hundreds and hundreds and hundreds of videos. So let's get on to some of the technicals and look at the The US dollar index and the dollar index I was saying last week that there's a potential For a buy on the dollar and I'm still looking at long dollars Although we did come down to this demand zone. I was saying that was probably one of the options So I do think that we've come down to now 50% really of the high to the low, which is another Also known as fair value so fair value for the dollar from July's low to October's high so fair value at the moment and I think this is where the dollar may start to at least Catch a bid catch some buys again, depending on obviously the data But this week we had or last week I should say the Fed minutes show unity on cautious approach to future rate hikes and so they are to clarify progress on process of reducing inflation and officials agree Fed in position to proceed carefully and so the Federal Reserve policy makers at their most recent meeting United around strategy to proceed carefully on future interest rate moves and base any further tightening on Progress toward their inflation goals so all participants agreed that the committee was in a position to proceed carefully and that the policy Decisions at every meeting would continue to be based on the totality of incoming information according to the minute so Totality of the information is basically looking at GDP looking at inflation if inflation is coming down It means that the Federal Reserve are less likely to hike rates They'll like it to remain on hold and I think pretty much all Hikes have been priced out of the market now or near enough priced out of the market And so there's gonna be if if for example, they should inflation is coming down. I don't think the dollar really will Devalue a lot. It's not necessarily a I don't think it's on a in a downtrend I think that the dollar is still a potential buy Especially when you compare it to a lot of other other currencies which will get to in a sec and there was some actually some decent news Which was initial unemployment claims in the US declined by most since June and so Unemployment really is in you know an important measure in the Fed look at unemployment Because again, it gives an indication of how well the economy is doing Overall and if there are jobs in the economy and employment is low It means that the economy isn't doing as bad as you know It's not heading necessarily heading into a recession because in a recession you have high unemployment So if employment unemployment is coming down, it means that it's a positive reading for the economy and so The economy seems to be doing okay, of course, so the Fed are you know likely to hold now The dollar index is just a measure again of dollar strength overall and I do think that You know with with the dollar not necessarily being You know the worst currency in terms of their economic data and inflation data I still think the dollar can still look for but I'm well, I'm I'm looking for potential buyers on the On the dollar of course you can do what you want, but if you are a buyer of the dollar I think probably now around this fair value area looks actually quite decent You can look for pullbacks on the dollar index if you're looking to sell of course You're not necessarily buying a dollar index you're looking for dollar crosses and looking for you know dollar yen dollar Swiss dollar CAD whatever currency you want to trade against the dollar and Look to see if obviously that currency is at a demand zone or an area that you think is a Decent area of value and a bargain price and a discount price and then look for some buy trades There so that's really where you're looking at and Yeah, so that's where we are with the with the dollar looking at the federal Reserve the the dollar yen right and the dollar yen is in a I think it's in a similar position in terms of buying there were some levels that I've highlighted You know last week that was saying that the potential for prices to bounce off of these levels within this wide area of demand Right and so on a daily When you get these wide areas of demand Unfortunately, that's just what it is right, you know these these are areas where prices could start to bounce off of these higher high higher lows So if you're looking at for example high low high low high Low high and we draw the demand zones from These higher lows in the last bearish candle for prices making new a new High then it does look like you know this this could be quite a wide zone But we've come down into this one for 750 area Which was again used as support support and then it acted as support within that zone as well And then prices kind of moved up from around the one for seven so We've obviously established some sort of Price buying from that area there So I do think that prices do pull back Slightly below the area because it is an obvious level of support. I just think slightly below it I think that's going to be a really nice area to look for some buy trades if you're looking for short trades I'm buying the Japanese yen then you're looking at this and actually the yen and Japan did have some Inflation and inflation reading that came out which was higher than expected and so that kind of puts the bank of Japan in a bit of a sticky situation in terms of inflation rising but their GDP came that came out as being as contracting right it went into I think it was like minus 0.5 so I still think they're still a bit dovish. I think for now The the the US is in a better situation than the then the then the Bank of Japan But I think that will change next year I think maybe going into the end of this year the dollar was probably still likely to be the buy But if the Bank of Japan Can get the economy going and the government can get the economy going and it starts to grow again I think that Bank of Japan and the yen should be an absolute sell because they're going to be really the only Bank that are going to look to hike next year Whereas everyone else is predicted to actually cut rates next year So the yen should be the one to buy for for 2024 But the timing of it is obviously the challenge and also as well depending on whether the data supports you know the Bank of Japan turning a bit more hawkish and looking to change monetary policy so These are the areas you're looking for in terms of buying or these are the ones that I'm looking to buy or sell The dollar CAD has come down to a really nice area And I'm now looking to be a buyer of the dollar CAD this week There is obviously data coming out you've got GDP growth rate, but for Canada you've got The GDP growth rate now the previous is basically zero percent. They haven't necessarily grown I think if they go into a contraction into the contraction phase or even stay at zero then I think the The Canadian dollar is going to be a sell Which then means really? You should be looking for or I'm looking for buy trades right looking for buy trades I think the dollar is in a better position than the Than the Canadian dollar so anywhere around this area It might come even lower as we head towards this data, of course And see what happens there now I don't know what's going to happen No one knows what the what the data is going to show but if unemployment comes out as full-cost is an unemployment it's going higher and GDP comes out, you know as zero or contracting a bit more than I do think that the Canadian dollar is Going to be a really nice Continued sell and the dollar would be a buy against the Canadian dollar But of course as well you have to obviously watch for the US news But I think the overall the US is in a better position the situation than the Canadian dollar New Zealand dollar this week we have the it doesn't show on here, but we have the central bank announcement and Again, it's expected to to be a hold So if prices, you know going higher as we get into the central bank meeting and they you know The data comes out and they release and they say there's a hold And also as well there may be a bit dovish then I actually think that the New Zealand dollar might start to Might start to sell off. I'm not saying it's going to be a massive sell off but it may start to sell off a little bit in terms of The news being priced in already, right? So it's by the room is sell the facts So I do think that I don't know if it's got much upside potential against the dollar, but let's see But if you do want to be a buyer of the dollar, then you're looking at yeah Like I said any shorts here, but New Zealand dollar if you're looking for any buys And you're looking for a pullback at least into Probably this one of these demand zones. You've also got a decent area of Decent area of Resistance and a bit of support there So definitely price has been traded within that wide area of demand and also as well You do have another area that's been looking like support and resistance in that area as well So you've got resistance bit of resistance on that candlestick there and you got a bit of support So either at the 0.599 or 0.60 round number that lines up with if you want to get loan on the New Zealand dollar Or down into the bottom of this demand zone The 0.59 area to look for any kind of long trades looking at the The pound dollar and the pound actually had some decent news this week and It says here that traders trim wages on UK interest rate cuts after strong PMIs so It says here money markets are pairing back bets on the Bank of England rate cuts next year after strong UK business activity They have showed signs of sticky inflation in November. So You know the narrative now and what's going to dictate whether Currencies appreciate or depreciate against each other is going to be the narrative of Who is going to be cutting first next year and who's going to be cutting last? So if trade is a pairing back bets right or trimming wages that Rate cuts are going to you know happens later rather than sooner after strong economic Economic reading then it looks like the pound actually should be a decent buy at least in the short term So that's the reason why you're seeing the pound still, you know continue to rise Against the dollar because I think it has to be revalued. So we've kind of broken through that area of Supply based on you know the good news with regards to the the economy the UK economy And I do think again, there is some areas to look for buy trades if you're looking to buy the dollar So by the pound against the dollar either pull back Or something like that But I think upside maybe cat or limited a little bit So there is a level there that you can look towards selling and some levels in and around this song here before looking at Some cells, let me just delete there and as well Too much of these these zones on on second All right, so into this Supply zone. We've got two areas which are quite nice in terms of Sell trades, but if you're looking to buy and take advantage of us and maybe some pound Bullishness I personally wouldn't be looking to buy the pound against the dollar Put it be a bit against weaker currency like for example the Canadian dollar if the Canadian dollar news comes out and supports Canada sells right so that's where we are with regards to the pound the The pound yen similar story and in fact this would be maybe a currency I would look towards I am looking towards buying on a pullback So any pullbacks into a nice demand zone are going to be nice for a potential buy with the Bank of Japan remaining quite dovish and the Bank of England Being a probably a bit less Bit less dovish and traders obviously taking great hikes Or a cut sorry off the table for now or prolonging those rate cuts I think the pound on any pullbacks against the yen are going to be decent as long as the data supports that right so This week it looks like the this week But the the past data was that inflation came out higher for the yen So that actually was was a slight positive, but again because of the GDP data. Let's see if it's here Yeah, GDP data came out on the 14th and it came out as minus point five And it was forecasted at minus point one so it contracted way more than expected which This is a basically a drag on the on the on the yen, right? So that's the reason why you're seeing pound yen going higher So I do think that prices should potentially go higher It hasn't been this high since it looks like October 2015. So that's been a good Eight years or so. So I wouldn't necessarily use any levels to look for any kind of shorts at the moment, of course You could if you wanted to try to look for shorts right there, but Yeah, again why buy the why buy the yen is is really the question Don't you show ever you should be buying again against the the pound at the moment But if you do then this is a decent area to look for some short trades these highs Euro dollar and talking about the euro I Did want to talk about or introduce in fact as I said at the beginning of the video my last trade So what I'm gonna do is I have a section at the end of this Analysis the weekly analysis and I'm going to a bit more detail Every week on the last trade that I've taken whether it's a winner Whether it's a loser or whether it's a break-even trade. So I did take a euro Swiss short And I did also take a euro dollar short this week, but my last trade was the euro Swiss shorts I'm gonna break that down why I'm I've got short on that euro in a bit more detail. So You know watch to the end of this video if you do want to see some more analysis and some intraday An intraday setup and what I was thinking because I tend to typically just do the bigger picture analysis For these Sunday videos, but I don't necessarily go into The details and that's kind of reserved for the discord group But I'll do a little bit of that on this on that trade breakdown for the euro Swiss anyways So euro dollar Yeah prices are making high highs prices pulled back last week into this demand zone and Again, we've seen prices going higher now It's my view that I think the definitely the the euro is in an expensive It's quite expensive at the moment in comparison to all current season There's really no reasons for it in terms of fundamental reasons other than the fact that the dollar has gone a bit weaker Right, so it's not necessarily that the euro's strengthened. It's just that the because the dollar is weakened And the euro is pretty much in verse to the dollar the dollar the euro is benefiting from Dollar weakness, but we've got inflation coming out this week. So Yeah inflation coming out this week one second. Sorry not that one It should be on the whereas it yeah inflation is going to be on the 29th and And also as well, we've got yeah year-on-year flash Inflation so yeah 29th and 30th inflation readings and so if inflation comes out Lower than expected and it looks like it is forecasted Previous is 2.9 forecasted is 2.8 Then I do think that the euro should want to roll over because then Rate hikes are going to be taken off the table It doesn't make sense for the European Central Bank to be hawkish anymore if inflation is starting to come down so I think this this week we could even see prices retest these highs or Even go slightly higher But I think the data would definitely be the catalyst for a move to the downside It might even take out some of these stops as I'm actually in this trade It's a break-even trade now for me. So even if prices do come up and stop me out I haven't lost anything on this trade but Yeah, my bias is still to try look for short trades I forget stopped out then I will look for more trades to the downside as long as the data obviously supports that narrative If not, then in fact you're looking for a pullback into this demand zone before looking at going Looking for long trades and that would be again based off of really I have a dollar weakness or you're looking for You know if inflation comes out and it's you know higher than expected then you're definitely going to see a hawkish European Central Bank and in fact this could potentially start to go to maybe the one tens But I think past maybe one tens one eleven's, you know I do think that it starts to get problematic for the euro in terms of rate hikes and In fact rate not all rate hikes are appreciative of a currency and his reasons why but um Yeah, that's where we are in terms of the the euro dollar at the moment And let's see what happens this week, but my bias is still to look for some short trades Euro yen at the moment. We did bounce off of this demand zone very nice The euro yen isn't necessarily a payout I'm looking to trade but if you are then you're kind of caught between this supply zone here and This this demand zone at the moment. So either way Depending on which one you wouldn't be a buyer or seller of I Think you've got reasons to buy or sell this this euro yen Moving on to the Aussie dollar and Australian dollar is one of the pairs that are one of the currencies I'm looking to buy in fact just not against the the US dollar at the moment But I do think that the Australian dollar is a buy for now And so as we kind of head up into this level here where you got support support resistance resistance as part of a supply zone as well There's the potential for a short trade and especially because you do have I think some Data coming out some inflation data coming out this week up for the Australian dollar And if that comes out lower than expected in fact the Australian dollar may actually likely sell off So we could see some of the night that happened down back down to maybe the 65s But I think overall the Australian dollar should be the potential buy depending on what the central bank says and what inflation What inflation does this week in the inflation data? Yeah, so ultimately those are really the options any kind of sells now or maybe just up higher into that 6650 area to look for some short trades And buying the other US dollar if you're looking to buy the Australian dollar any pullbacks into that 65 round number and just below that I think is going to be quite nice and The Aussie yen. I think this is again another nice buy Just pull back into maybe that demand zone right there to look for any decent trades Continuations to the upside. I think the Australian dollar is definitely ahead of the Of the Japanese yen and so Yep, I think that's pretty much where we are if you're looking for any kind of short trades Then I think what we're seeing above that area I think this is going to be very nice for a potential stop hunt if it does appear of course is against the fundamentals But as a technical level, I do like this So if there are you know, there is any kind of Change to the fundamentals and you start to see a stop hunt Then I think that's going to be very very nice for a for a short trade But for now my bias is really to the upside so any pullbacks into either the 97s or even just deeper than that are going to be buy trades for me and Looking at gold so gold again with the dollar kind of weakening over the past week again We've seen gold kind of drift a lot higher and So again, if you are looking to buy gold and short the dollar then you're looking at A pullback really to demand zones and nearest demand zone is this as we've made a higher high now It's going to be right here So any pullbacks into this so you can see that level was also being used as an area of support and resistance Right where you've got support there bit of support there bit of resistance bit of support. So down into the 1967s is going to be decent for a trade as well As this area here, which is the 1932s for a pullback and again, that's acted as resistance resistance and again some support in and around their zone there so Some decent levels to look towards buying gold if you're looking to short gold Which is basically looking to buy the dollar in fact again for those of you who trade stop hunts I think this level here just above is going to be really nice for a for a stop hunt type trade So level level level and then you've got this if it does start to stop on Right there. I think that's going to be quite nice for a short trade But again, you have to really kind of see a catalyst that have to be some really good news coming out of the US and maybe even if Jerome Powell is is actually hawkish and ISM comes out again better than expected his forecast to come out better than expected So if it does or if it comes out higher than forecasted then that should be, you know, a nice catalyst for any kind of Dollar strength so that brings us to the end of the analysis and now I'm going to go into the Trade that I took on the Euro Swiss, right? So here we are on the Euro Swiss and took a short trade. My entry was at the 0.9 6 7 5's and my stop loss was 11 pips above the high at 0.9 6 9 6 3 so the question would have been well, why did I take this trade so fundamentally? I'm actually a short. I've got short bias on the euro so One of the things I do use is the is is the is a currency index and now this is a I guess more of a custom currency index where you kind of multiply the The all the currency pairs and it gives you more of a level average of the euro and what the euro Euro strength and weaknesses against all the currency pairs That we trade right against the dollar the pound the yen the cat the Australian dollar the Swiss franc in the New Zealand dollar, right? And it gives you I think a more equally weighted Index when it comes to looking at the euro index because typically the euro index you've got that I think I think the euro index is the EXY But that's weighted slightly differently in the same way that the dollar index is weighted which if we look at The dollar index understanding of the you DX why but it's basically the same thing It says here that the index is currently calculated by a factor in the foreign exchange rates of six foreign currencies Including the euro the yen the Canadian dollar the British pounds with his corona and the Swiss Frank and then the the weight is made up. It says Europe by far as the largest component of the index making up 57.6 percent of the basket And the weights of the rest of the currencies in the index are the yen 13 percent the pound 11 percent cad 9 percent sec is 4.2 and the Swiss franc is the 3.6 now There's nothing wrong with using the dollar index and the DXY or the UDX USDX Of course, many people do use it, but I find that when I use the The more equally weighted Calculation of the of the euro and other Currencies I find it a bit more a bit more accurate for my liking and so looking at where we are in terms of Understanding if the euro is is appreciating or devaluing where it is in terms of value It looks like we're really at these highs These were the previous year's highs if we go to the year-to-date Here you can see that this was the the the August highs right and then we basically broken past these August highs In comparison to where we were the least the most recent low an obvious low, so The question is well why is the euro strengthening because it's got great data and the economy is growing and the The ECB or hawkish and to me my mind is no it's really just appreciating because there's been some dollar devaluation and Rate hikes are being priced out of the market now So when you look at where we are in terms of highs highs are typically, you know What would be known as a premium or an expensive area right expensive and no one wants to buy a highs the mantra That the cliche is you know by low sell high you don't want to buy high and sell low So overall, I think this is an expensive area for the For the euro and I'm looking for really prices to come back down to fair value Right to some degree now if you come back to fair value and goes higher It is what it is But I'm trying to take advantage of this move back down and the devaluation of the euro back down to at least fair value and possibly Even lower so what we saw and what I saw on on the Tuesday When I entered the euro Swiss was that the euro was on the Expensive side very expensive prices were up here right at these highs and so going to the euro Swiss on the Tuesday What I was looking for was Really that can intraday entry now Again one of the things that one of the setups that I trade a stop hunt and is a certain criteria I'm looking for a round here to look for to For me to for this to be a valid stop hunt in the way that I trade them and I didn't quite get it There wasn't quite the stop hunt in and around here, but I did get a nice candlestick Entry, which was basically right there at that price And so this was the trade right this was the trade entered and that was a you know 10 in the morning on the Tuesday and We did get some Euro Devaluation coming to the coming to play now The way that I trade what I do is I break up this trade into three or four right three or four Orders so I thought I've got a market order then two pending orders if prices do come back and give me a better entry Right so prices come back and give me a better entry then I've got a better price And then I've got another pending order self-pending order around here now. I only managed to get in on unfortunately one Position you know typically I can get in on two but sometimes that happens where I only get in on one And if I get in on one position then what I'm doing is I'm looking for if prices come down to at least a one to one risk-a-ward ratio then what I'm going to do is I'm going to protect myself by taking off 50 percent of the of the position to get myself to break even right and so Break even really is a good place to be at it takes really kind of the stresses and pressures off of you in terms of You know, wherever you should hold or take profit to a certain degree And if you're looking to swing trade this like I am a Bit lower then understanding that where my where my I'm a break-even and I don't necessarily have to Move my stop-loss either by taking 50% off is a great place psychologically to be at right So for those of you who don't really understand, you know, what I mean So what I do is basically let's say for example this trade I risked Two pounds right just some simple stuff right there's two pounds on that not saying I did but just say I risked two pounds Right now I take 50% off. Yeah, which is basically I'm removing 50% Off of the two pounds which now means that I'm reducing I've taken one pound profit. Yeah, one pound profit And then I have now one pound risk Yeah One pound risk in the market Yeah, so price has now come all the way up here and stopped me out This is a break-even trade and so for me This is the way that I trade for better or for worse Some traders may agree much. I'm traders may not agree, but this is for me the way that I look to trade and You know it works for me, right and so From that position now, I can't lose and my stop is in a safe place Some people try some traders may just move that down to break-even right there and you can do that But if prices come up stop you out and then roll over. Yeah You would have been stopped out a break-even for no reason when really the rule of thumb should be You know place or stop placing your stop loss in a place where you're definitely wrong about the trade If prices come all the way up here, then I'm you know likely wrong about the trade And I can look to probably re-enter at some point So this trade at the moment is a is a break-even trade with a slight win when we think about, you know The second half of the position So hopefully prices can roll over this week with some data That comes out that is maybe, you know, not great for the euro and let's say for example prices come the data comes out And the data is supportive of buying euros and let's say for example prices are around here And all I'll do is I'll just exit the trade right because because the fundamentals are going against me But for now, I'm at a break-even position What profit boy at the moment unrealized profit at the moment with a break-even trade and You know, I don't necessarily have any anguish or any What's the word I'm looking for? I'm not I'm not, you know stressed out about whether I should I should have taken profit Down here or somewhere around here. I've already taken profits. I've always already protected my position So it's a good psychological trade, you know and place to be in so that's where we are That's my last trade at the moment this week. I did take one on the euro Dollar as well, which is also pretty much in the same position It's a break-even it's pulled back a bit against my position, but I can't lose on that so it's all good and Yeah, that's it. So guys until next week, I bid you a great trading week and Take care and I'll speak to you all soon