 Hi, my name is Dio Miro, currency trader and trading coach at tradingoneat.com and welcome to this week's Forex and Gold Supply and Demand, Fundamental and Technical Analysis. If you're new, a warm welcome to you and an equally warm welcome to you if you are returning and if you find the analysis that I provide every week useful, please don't forget to like, subscribe and share with your fellow trading colleagues. And so let's get into the week ahead, which can be found if you're new on TradingEconomics.com. This is the website. It's week ahead. They normally do that on a Saturday or Sunday. And I'm just going to go through the synopsis really. You can go through the details if you want, just like obviously clicking on the week ahead and have a read, which is definitely worth doing. So this week ahead, as a summary, it will be a very busy week in the US with Federal Reserve's interest rate decisions, labor report and earnings report taking center stage. So investors will be closely watching central bank meetings at the United Kingdom, Australia, Norway and Malaysia and GDP growth and inflation rate figures from the Euro area. So all that is definitely a busy week. Finally China will be releasing manufacturing and services PMIs for October. So yeah, lots going on this week and let's see, you know, what happens and let's get into, guess a bit more of the fundamentals as well as some technical starting off on the dollar index and just to measure a dollar strength. And last week I was saying that, you know, for me anyway, my bias is to buy the dollar doesn't mean that the dollar is going to go up every single week, even though I have a bullish bias. And again, this isn't, you know, any kind of financial advice, just then, you know, what my bias is based off of the fundamental analysis research that I do. And so we did kind of break through the, this demand zone, but came down to the 109s bounced from there. And you know, this was basically due a pullback. If you look at basically the year to date price action, this is just a pullback. If you know, you tend to zoom in, which traders tend to do for some reason, you know, then it looks like a deeper pullback than what it really is. So always zoom out, give yourself a bit of perspective as to, you know, what is actually happening with price, and it might not be as bad as it seems, right? So my bias is to the long side, you know, if you've been following along anyway, you'll know the reasons why the basically the Fed, as much as people tend to focus and hyper focus on what's happening in the US economy. For me, it is still the best, the worst, you know what I mean? Of all the economies in the global economy, in terms of their economic standing and what their central bank is doing with interest rates. And so the Fed and the Bank of England prepare for 75 basis points this week. And the US jobs data may show weakening Euro area GDP seen slowing, but we focus on the US and Federal Reserve. So the Federal Reserve and the Bank of England made both under the 75 basis point interest rate hikes in the coming days in a show of aggression towards inflation, which they have to inflation has been, as they call it, sticky. And to get inflation down, you have to kind of hike interest rates if it's not coming down, even in the face of mounting recession risks. And the Transatlantic Double Act illustrates the tradeoff confronting central banks as evidence of an impending global economic contraction becomes harder to ignore, even as inflation lingers. And for the Fed, the fourth such outsized move on Wednesday will bring it to a crossroads. The damage to growth inflicted by policy tightening is no longer being masked by the buoyancy of the post pandemic economy, while its success in taming inflation has yet to materialize. And we recently had some some decent news on the on the economic front. GDP wise for the for the US for the third quarter. And so for me, the US at the moment is still in a pole position. We'll get onto the Bank of England situation and the pound a bit later. But also as well, the jobs market is are defying central bankers efforts to cool demand. And so unemployment remains low in developed economies as rates soar and weaker hiring would allow central banks to slow tightening. And this is because, in fact, unemployment is actually linked to inflation. And if unemployment rises, inflation can does has it have a correlation where it actually starts to come down. And robust labor markets defying central bankers efforts to tamp down inflation and economists predictions that a recession is just around the corner. So it's a strong jobs market is good for workers, but it's bad for inflation. Signaling the world central banks, which are raising interest rates at the most aggressive pace in decades that they can't ease up. And in fact, it's my sound counterintuitive, but central banks actually want a bit of unemployment, not too much unemployment, but they want unemployment to kind of help to bring down inflation. And it's borrowing cost surge and growth slows. Unemployment rates are not rising. Instead, companies across developed economies are complaining of chronic worker shortages, a persistent mismatch between demand for new hires and the supply of workers is supporting wages and shielding consumers from slowdowns just when central banks need fading demand to cool inflation. And so yeah, there's there's there's a there's a lot going on here. And just a quote from Joseph Lipton at JPMorgan, it says, you see broad based strength in labor markets as Joseph Lipton, global economist at JPMorgan. Strong jobs growth is absolutely the central support for the consumer. So it's supporting the economy, right? But at the same time, it's not helping with inflation. You know, when when central banks actually want inflation to come down. So a bit of a conundrum for all central bankers, right? Not just not just the Fed, but it's all central bankers. But that puts the Fed in a decent position in in so far as, you know, rate hikes potentially at least are being supported, at least in the short term by the economy. So for me, it's just about continual buys for the dollar now. Dollar index, obviously, is just a measure of dollar strength and you can use it in correlation or confluence with any kind of dollar buyers and a dollar yen, dollar Swiss, dollar CAD, if that's your rate, that's the way that you want to buy. So for me, decent buying opportunity coming down to this demand zone and even better if prices do come down before the rate hike. I think the rate hike is probably been priced in already, but it's all about future rate hikes and looking to see what the Fed actually say. And if they're, you know, still hawkish because if they're still hawkish about a potential, oh, sorry, that's meant to be a K, I S H. Sorry if that looks a bit un-eligible, but if the Fed come out on Wednesday and they are still hawkish and they're indicating another 75 basis points or at least that's what the market thinks, then you should see, in fact, you know, the dollar, at least over the medium term towards the end of the year, start to look to still strengthen. Right. And so there was something from HSBC. I was thinking whether I should clue this or not. But I thought I might as well. And in the analysis HSBC, they say until the broader drivers of the US dollar, right, which has been global growth, risk appetite and relative yields show a bigger shift, it may be too premature to call for a weaker dollar because there's been a lot of talk about potentially, you know, the Fed pivoting, right? There's been some Fed pivot talk and that's understandable. But until certain, you know, fundamental shifts happen, then you know, I think short in the dollar might be a bit too premature. And I would have to agree with that. Anyways, so my bias is to, you know, continue to buy the dollar unless there are some fundamental shifts. Moving on to the dollar yen and the dollar yen. Again, looking at the year to date, zooming out, you know, you're seeing just a little bit of a pullback. The yen, the Bank of Japan actually did have an announcement, but they're basically they're still sticking with ultra low rates policy path and essential bank keeps negative rates and 0.25% cap on yields. So the Bank of Japan stood pat by its ultra low interest rates and with fresh government support pushing back against lingering market speculation, it will adjust policy as it continues to predict inflation will call at 2% next year. So they haven't changed their monetary policy. They are still intervening or looking to intervene. And that's basically what pushed prices down about maybe about 600 pips or so, 500 pips, something to that effect. But I'm not sure whether it's going to continue going to the downside, because I think you do need a definitely more of a fundamental shift in the central bank policy rather than just intervention as, you know, that's what how the market is seeing things now. So this is, I think, is still a great opportunity to short, especially if there is a fundamental shift on the on the US dollar. I think that's going to be a fantastic sell. But if you're looking to buy at the moment, you still need a bit of more of a pullback into that demand zone in order to get long looking at the dollar. Swiss, not really a pair. I'm looking to trade last week's analysis is still on here, but you can see that I did draw this area of support and resistance. You can see where prices did actually bounce off of that zone. Right? Support and resistance is a zone. And so a decent buying opportunity there. If you was looking to buy the dollar over the Swiss franc, not really a pair that I'm interested in, I do like, in fact, this from a sell trade opportunity, especially the this area here, technically is nice, but you'd have to really believe that the Swiss franc is the is a short trade as far as it is a bargain price around these highs, the 101s, 50s. So for me, if I was looking to buy out of the two, it'd still be the dollar for now, but let's see what happens if the dollar again has any fundamental shifts and then nothing. This would be a very decent buy for the Swiss franc. Moving on to the Canadian dollar, looking at last week's analysis, we're talking about the 75 basis points that was expected. And actually what we ended up getting was 50 basis points. They actually did a dovish hike. So the market had to kind of reprice the the Canadian dollar on many pairs, at least temporarily. But for me, again, not really a pair that I'm interested in, but if I was looking to buy any of these two, it would have to be the US dollar. And this is a decent area, a nice fresh area of demand. I think that's a nice buying opportunity for the dollar, especially because they're more hawkish than the than the Canadian dollar. So for me, my bias would be to the upside, although I'm not really too interested in this pair. If prices do come down to the one three threes, one three two area, I think that is a very nice buy opportunity for the dollar. If you are looking to buy the Canadian dollar, then again, these these highs, the one forty to one point three nine area would be a decent area to look for any kind of short trades. Moving on to the New Zealand dollar, US dollar. And again, just zooming out a bit, looking at last week's analysis, still on the charts, I'll delete it, though. Again, prices have come up to this area of supply. Did actually break the supply zone here. So you did have a bit of a move to the downside. Prices are coming to the up to the upside. But for me, I think it's just a case of if you take this high to this low, right, we've really just come up to some fair value, right? Yeah. So we've come up to fair value between an obvious bargain area for the US dollar and expensive area. This is pretty much just fair value. But if you're looking to trade this to the short side, meaning you're looking to buy the US dollar on a pullback just before FOMC, then I think it's only going to be decent for a nice short trade in a risk off environment, you know, the dollar should win, even though the New Zealand dollar is also the RBNZ, their central bank is still hawkish as well. I do think that the dollar should win out in the in the at least a short term. If you're looking to buy the New Zealand dollar, then you do have quite a wide zone of demand with which to buy. But I would definitely say the best area would be, you know, to look for lows around the one firefighter, because this is obviously where the bargain was for the New Zealand dollar or expensive for the US dollar. So if that might be expensive again or a bargain, depending on which way you're looking to what you're looking to buy or looking to sell, right, or looking to short. But my bias would still be to the downside. This is just really a pullback. Looking at the pound dollar, pound dollar, pound has risen. I'm I'm actually short on this trade here to get stopped out of my final position. Small stop stop out on that, but I've made money on that. So now I've re-entered into a short on this area here. And I'll just get rid of some of these brushes, right? And so I think there was we did have some weekend analysis and private weekend analysis where we saw some targets talking about potentially price coming up to the one seventeens. And that makes, you know, that does make some technical sense, as you can see, there's a supply zone there, but as well as you have the confluence of a of some support and resistance and, you know, that has been traded. So if prices do go higher, even though I'm short on this, I'm still going to continue to short this because if you look at this, if you look at the UK fundamentally, I think they're they're not as again, robust as the as the US. In fact, I'll go back to this article first. And it was talking about the Bank of England situation on Thursday is even less comfortable than the, you know, then the feds, right? Because it's all about the fed in that paragraph. So, you know, it's even less comfortable as it delivers what would be the biggest UK rate hike since 1989. Not only is the country probably already in recession, right? Already in recession, whereas, you know, you've got the US actually coming out of a technical recession. It says, but officials are also trying to reestablish the credibility of the US, you're sorry, the UK's framework after former Prime Minister Liz Truss's unfunded fiscal plan led to a disastrous market crash. So again, when it comes to currency trading, really, you're trading with the least fleas and what you'll see is as well, if you go to some of the data. So where is this data that I put here is, right? So United Kingdom, if you go to a GDP growth rate, in fact, trading economics is forecasting again, minus one percent growth for the third quarter, right? So preliminary, you know, third quarter growth previous was 0.2 and therefore costing 0.1. So very, very interesting. And I think that that should drive the pound lower, saying it's going to be today or tomorrow, or even this week, we could have a week where prices still go higher. But eventually, I think for me that the, you know, the downside is should at least want to come back down to at least the one tens as a minimum. And if I'm shorting out the one sixteenths, you know, around the one seventeenths, at least about 700 pips to the downside, you know, potentially. But again, this is not me telling you to buy or sell the dollar. This is just me telling you what I'm doing, not financially the price, but if you do want to be a buyer of the the pounds, then you're looking for pullbacks into that area there to look for a buy trade. But I do think this is actually quite decent for a for a short over the next at least until the end of the year. Moving on to the euro dollar, euro dollar. And before we start the euro dollar, I just wanted to remind everybody that I do have with Mark Chapman, a webinar on Thursday, the 3rd of November. I think last week I might have put Thursday the 4th of November. There might have been a bit of confusion. My apologies, but it's the 3rd of November this week where I will be discussing fundamental strategies and Mark will be discussing smart money concepts, market maker concepts and the market making concepts that you would never have heard, but from anyone else on YouTube, from a real market maker, not necessarily Mark being the market maker, but Mark's good friend who is a market maker and has told him how market makers actually the business model of market making. So if you haven't attended before, please definitely come to the webinar. You will definitely find practical uses to what I'm going to tell you when it comes to fundamental analysis strategies and please ensure as well that you watch my previous webinar that I did in in April, because that will help you understand some of the concepts and and strategies that I'm going to be showing you on Thursday, right? So the link will be somewhere in the description box. I'll put it on the top right hand side of the screen if you're watching and it should pop up there. So please watch that first before coming and then join the Zoom call on Thursday, the 3rd of November, 2022 this year, and the link to join will be in the description box below also. So back to the Euro dollar and the Euro dollar has had some legs, nice little pullback, was looking at potentially, you know, some shorts around here. But in fact, there was a nice what what traders would call a stop-hunt on a lower time frame in and around this area here, I think it was a stop-hunt. Yeah, it was a stop-hunt. Can't really get into it right now. But basically, there was an opportunity to get short as well, just from an extreme example in terms of looking at a fresh area of supply, right? So you had lower highs and lower lows being made, nice fresh area of supply, you know, starting from around here. And prices have gone to the downside. And I think with the with the FOMC coming on the way this this week, I think what was happening last week was obviously there was a liquidity hunt because the European Central Bank did kind of go into a bit of a dovish, a dovish hike because they were not very hawkish when it came to their future projections. So the ECBs are not favours a 50 or 75 basis point hike rate in December, whereas I think before they were very hawkish. Now it's like, is it 50 or is it 75 basis points? Whereas the Fed are really looking at, you know, I think around about a 50 or so, about 75 basis points hike recently. So Dutch official says another substantial step forward needed and the European Central Bank governing council member Klaus Knott would favour an interest rate hike of 50 or 75 basis points in December. Though he highlighted that a decision has yet to be made. And so a third three quarter point increase would be possible, but it's too early, says not an interview on the Butenhof TV show on Sunday. We still have six more weeks to go and there is still a lot of economic numbers coming out, right? And that is actually really important because depending on the economic numbers and actually something that I'm going to talk about in the webinar as well and really how to identify really dovish hikes and when hikes really should appreciate a currency and when they shouldn't appreciate a currency and they tend to devalue a currency. I'm going to be talking about that in the webinar showing you examples. And yeah, so to European Central Bank at the moment, they have some hawks and some doves and it looks like there's more hawks just than doves. So it could be just an even split. But let's see what happens. But for me, again, the Europe Europe again, like the UK in in in worse shape than the US. So for me, any pullbacks are always, always, always, always buying opportunities. And I think this is definitely a nice buying opportunity on the euro dollar. Hopefully prices do follow through to the downside because there are targets actually of ninety fives. So I think this might be actually the high of the the auction or many people would know as a range, right? I think that might be the high right there. And we've come up to that and then we should hopefully want to roll over this week. If it goes a bit higher this week, that's all good because then just means that you can buy the dollar for a cheaper exchange rate. But that's obviously if you want to be a buyer of a dollar, again, this is not financial advice. But there is a level slightly above it and that level has been touched actually the first time in the first time touches always the best time. Second time touches are OK, but this is probably the better area. If it goes up to one or two is one of freeze, I think that is going to be a very nice area to look for some short trades. But for now, I think I'm short from around here. Let's see how that does work out. Looking at the Australian dollar, US dollar can be bounced right off of that the top end of that supply zone from last week's analysis. And pretty much I think everything is the same. The dollar should be the dominant currency. The RBA is hawkish, although there was inflation actually came out quite. It came out more than expected, higher than expected inflation print, which I think may actually make the RBA a bit more hawkish potentially. But it really depends. But I would I would assume so. But against the US dollar, I think they're still lagging behind. So I do think that any pullbacks to supply should be shorting opportunities. If you're looking to trade this pair, if you're looking to buy, I would definitely say the lower end of these 61 areas, 62 to 61. 70s are the prime opportunities to look for any kind of long trades. Ozzie, Ozzie, and again, Ozzie, and I think from a risk on perspective, you would just look to buy the Australian dollar, right? And I do think if intervention isn't working in the way that the Bank of Japan is hoping, then, in fact, you could just see if any pullbacks should be actually buying opportunities. So if prices can pull back to that supply, that demand zone there and you want to be a buyer of the Australian dollar, then brilliant, that would be a decent area to look for buy trades. But if intervention does start to work in the market and the market is taking some notice of intervention, then I do think that this area here is going to be the 96 areas are going to be really nice. And in fact, even the 98s is going to be a fantastic area to look for any kind of short trades. Moving on to finally gold and gold. Again, still a tough one to buy at the moment, especially with the Federal Reserve being so hawkish and even though inflation is high, it looks like a lot of the money, smart money, if you want to call it smart money, but big money is still continuing to favor the US dollar over gold, which is basically driving gold prices to the downside because they're actually getting a yield, gold doesn't pay a yield, but this also presents a great opportunity if you believe that next year because ultimately we've got where are we? I think it's here. Now, what was the this is it? So a strong dollar scene hurting the US outlook and even tilting Fed path. So there is going to come a point where the Fed are going to stop hiking rates and then the focus is going to be on the economy and we're going to have to see the effects of a strong dollar or the more specifically rate hikes on the economy. And I think once the Fed do start to ease up on rate hikes, I think gold will then go to to the upside. But I think for now, at least for this year, this is more of central banks accumulating for cheap, right? Not from a trading perspective. It's difficult to trade this, but I definitely think we're buying perspective physical gold. This is actually a really nice buying opportunity and I think the further this goes to the downside, the cheaper it becomes. And but when that recession talk starts in the US, then I think that is definitely going to be the trigger, right? That especially when they even start to cut interest rates. So that's going to be very interesting. But I think for now, in the path of least resistance, probably on gold, unfortunately, from a trading perspective is probably to the downside, at least for the rest of the year. But I think going into 2023 right here, I think we should maybe want to start to turn around once the Fed do start their pivot. So let's see what happens there. Anyways, guys, that's it for for this week. And again, don't forget to join the free Zoom call Thursday, the 3rd of November. Actually, I forgot to put the time apologies. The time is going to be at 7 p.m. London time to 7 p.m. London time. It'll be in the description box below and hope to see many of you there. I think I might actually have a limit on my Zoom, which is 100 people. So if you can't get in, unfortunately, we've maxed out. So if you are in the first 100, then brilliant. If not, I don't know whether I'm even going to release this. I might I might delay the release, of course, because a lot of people end up might not end up coming, right? You might think so. I can just not come. And I really want to reward the people that make the effort. So I might not release any of these this this webinar. I'll speak to Mark as well until maybe some time even next year. So let's see what happens with that. But we do want to reward the people that do make the effort to come and give them a treat as well. And you're going to find the information that I provide and Mark provides really, really, really useful and it's going to be useful forever in a day because I'm going to show you some some more rules to the fundamental analysis trading game, which will give you an edge over the medium to long term over the short term. Price is quite unpredictable, but I'm going to show you how you could have traded the euro dollar this year, as well as the the dollar yen this year and how you could have predicted the the the price, you know, movements that have happened this year and how we did with some with some evidence of that of the of the posts that we posted in our Discord group. Anyways, guys, hope you have a great trading week. Can't wait to see many of you in the Zoom call on Thursday, 7 p.m. London time and take care. Hope you have a great trading week and speak to you soon.