 Hi, my name is Leon Rowe currency trader and trading coach at trading 180 calm and welcome to this week's supply and demand forests and gold fundamental and technical Analysis if you're a newer one welcome to you and if you're returning an equally one welcome to you, and please don't forget to like subscribe And share press that like button and subscribe button. I'm not even sure whether the YouTube algorithms really That the notification button is actually useful when watching on some videos on YouTube saying Even though you pressed a notification button. It might not actually give you the notification, but press it anyway and If you want to be kept up-to-date with you know the latest trading 180 videos anyways getting into the key events this week and this is from ING and so next week's US inflation numbers will need to be quite surprising for the Fed to deviate from a 75 basis point hike at a September meeting. Yeah, so That's really what the market is looking towards Is it is inflation and also as well the Bank of England? I think they actually delayed one of their scheduled meetings I think the PEP postponement of the Bank of England's scheduled meeting. So really this week is you know for the again developed markets the major markets Is really about US core inflation and it's likely to ride to 6.1 percent Bank of England stick to 50 basis point rate hike despite energy package from list trust and We have GDP July GDP on Monday. I think that's the month for month one the jobs on Tuesday for the UK and inflation on Wednesday as well, so Yeah a few things To watch out for Eurozone, I think also has August CPI numbers as well So that might be something worth watching Eurozone US. Yeah, pretty much everything else is is by the by so a few things to definitely watch this week and Let's get you know into I guess the the technicals and what's happened Fundamentally last week and potentially what may happen in the future Starting off on the dollar index and the dollar index is just a measure of dollar strength against major currencies like the pound the Euro and the yen and some others and Just watching obviously a dollar strength over the past looking back over the past year, you know has just been Kind of predictable when you if you've kept up with what's been happening fundamentally you understand I guess what what that the fact that the US is really One of the better Countries and currencies dealing with you know the crisis As far as or many crisis Events that are going on around the world So Yeah, let's get into the Bloomberg articles to jumbo Fed rate hike as we already know is in play as power sticks to hawkish view so Fed chair Speaks as bets for 75 basis point hike hard and says Fed Has accept and accepts responsibility for price stability price is basically in face inflation. So Basically the Federal Reserve Jerome Powell said officials won't flinch in the battle to curb inflation hardening expectations that they'll deliver a third straight jumbo hike Later this month and we we need to act now forthrightly strongly as we have been doing pal said Thursday in remarks at the Kato Institute's monetary policy conference in Washington My colleagues and I are strongly committed to the project and will keep at it. He spoke With a moderator in a virtual question and answer session. So What that basically means is that they're gonna continue to hike and what does that mean for the dollar and what you know in in trading This is basically a game of probabilities That you know that that is being priced in in so far as You know the fact that the dollars go and higher and higher Is being priced in so it's a you know the money has really been made right is to buy the rumor You know happened was happening and has been happening all this time, right? Just basically buying a rumor and confirming with data now with CPI data, right? Consumer prices index that's going to be a major I guess signal as to Whether the Federal Reserve and I spoke about this last week, right? Whether the Federal Reserve will continue to hike 75 basis points. Yeah, that is going to be key if inflation comes down Yeah, and it's I wouldn't say necessarily disappointing because in fact The US actually want inflation to come down and all central banks want inflation to come down to their 2% target, right? now if Inflation does, you know come down from I think it was a point five eight point six something like that And if let's say for example, it stays around there or you know It starts to plateau or it actually comes out as lower than than the previous number then The Fed are likely to do what maybe hike at 50 basis points because they won't need to To hike aggressively which then would actually should have actually have the effect of The dollar probably selling off and being repriced right revalue because this you know value The the dollar appreciating is based off of you know the market getting ahead of a 75 basis point hike And I'm not saying it can't go higher. Okay, but it probably couldn't potentially this week go higher But the market has already priced in what the 75 basis point hike and the value of the dollar should be now It would have to reprice the dollar yeah, if there's a Smaller Hike right so then you would if and that would be triggered by CPI data That's the CPI data will trigger that and so depending again and whether you know inflation is is continued continuing to rise or if it falls sharply That will determine the what happens really with the dollar this week and one of the things you should Go to on my YouTube page how to find or I'm gonna be going on YouTube and do a search Is my fundamental analysis webinar the three steps to generating profitable forex trade ideas If you don't understand the relationship between inflation and interest rates as well as GDP as well It's the webinar is about you know two hours long and it gives you really a kind of basic foundation as to understanding how you can navigate I guess You know forex and you know pick directions and really kind of predict trends Etc and whether you know it's a market that you want to you should be buying or selling or whether it's a market that you should be staying out of right so Going back to DX why so Yeah, moving forward. I probably expect if again CPI data comes out Positive as far as it's seen as growing then you would probably want to still continue to buy the dollar and pullbacks We do have prices have come down to this this demand zone But also as well the monthly moving fair value Which is basically just a moving fair move in average, it's got the EMA Exponential and a simple move in average, but in the context of understanding value an average or a mean Is is actually what we considered fair value because if this is expensive Right, and it is a bargain price Then if you're looking at you know the last 21 days, which is 21 days in a trading month, which is you know monthly You're looking at where fair fair value is right fair value between An expensive and a bargain area 50% between that is actually fair value Yeah Prices have come down to that fair value price now for me I tend not to look to buy anything or you know anything above at least a monthly Moving fair value because that would be considered expensive right you want to look for Not only demand zones, but on a daily or weekly time frame, but also as well Some confluence in terms of understanding where fair value is And fair value for me has come back down to the dollar So I know now is a decent time to look for you know potential buy trade doesn't mean that you should buy right now Prices go below that then that's gonna be a better bargain, right? So just gives context to You know understanding value and that is really important when it comes to you know fundamental analysis So for me It still continues to be dollar buyers, but I will be and I mean actually some some dollar trades anyway like the euro dollar So I will be Keeping my eye on on the fundamentals as to determine what I should be doing with those trades now Moving on to the dollar yen in the dollar yen Massive move last week, right? I think prices were at the 140s and they've literally just jumped up, you know to the 145s and Very interesting and I think the the Bank of Japan have literally now said That they are very concerned about a devalued yen and the speed at which is devaluing which is really important And so there's talk of potential intervention or they're definitely, you know Looking to push the button Not saying that they will but there's definitely pressure a lot of pressure on them to do that 140 was the line in the sand And obviously prices have gone beyond that so now the Bank of Japan are under a lot of pressure to Potentially step in but they're gonna have to probably, you know wait a little bit just to see If you start to see prices drift higher again, I personally May take a little short not necessarily on the dollar yen, but But something like the euro yen or some other yen crosses So Yeah, as we as it stands i'm still a buyer of the dollar So if you get a you know quite a large pull back now The from from the higher one the 145s where it kind of just peaked Down to the 137s is you looking at what's that about about About 800 pips, right? So that actually is a nice pullback Into a nice demand zone And then we also know as well that at least the monthly fair value would be below that as well So for me, I do like The fact that this area here is a nice area of demand I think bets will be off if the Bank of Japan do come out and say that they are intervening I think for me then I will probably hesitate on on trying to short Any yen Crosses, I think I'd have to just wait for the dust to settle and for for really value to establish itself But until that happens if price is just naturally drift back down to this 137 area Without the bank intervening the bank of japan intervening then I think for me that is a decent That is a decent buy and also as well depends on you know what the dollar is doing From a monetary policy perspective But my buy still for now is to go along on this currency pair Looking at the dollar swiss and the dollar swiss actually has dropped like a stone From last week. So we had a nice supply zone here And then pretty much dropped away, right? There was I guess maybe some risk sentiment going on Um, and uh, yeah, we've come down into this demand zone, which I think is actually really nice But I'm not interested in necessarily buying this currency pair simply because you've got two central banks that are looking to high crates Um, but if you are looking to buy the dollar swiss, I think now is a decent opportunity If you sold the dollar and bought the swiss frank against the dollar, uh, that was a really nice, uh, technical level I did like that, but um That will obviously you're a bit too late for that and if you did get into that that would have been well done, right? um For me, I do think technically I do like this level here the 94 round number I do really like that technically, but I don't like the pair to trade But those are your options for the dollar swiss dollar CAD the canadian dollar hiked rates this week And so, um, you know capping the upside for the Dollar CAD Which basically meant that um, if you were looking to buy the canadian dollar and they hiked by I think it was 75 basis points Um, that was a nice little buy right just before they did and uh, yeah That's it. So, um, make sense. But again for me, you got two Pairs two currencies that are hiking rates and um, if you have if you do have two Currencies that are hiking rates and let's say that you that you can't or you shouldn't trade them Um, because ultimately what you should get is actually a an auction or a ranging market as It's typically known on the uh, uh on the web Well, in fact is actually um an auction and an auctioning market, which is basically, um You know where buyers the sellers in agreement of the exchange rate, right? So this has been, you know an expensive area. This is again an expensive area This has been a bargain area. So, um prices are unlikely to you know, continue trending above that with the Bank of canada Hiking 75 basis points, but there's also a caveat to that right as well because You have to have a really good economy in order to support rate hikes and then you know and to support price Now when we get to the euro, um, you'll see there's a difference between the canadian dollar You know price increasing in value And the euro even though the euro actually did um hike There are their rates by 75 basis points But for me not really a pair that i'm looking to trade But if you are that was really the opportunity for you to get short and buy the Canadian dollar against the u.s. Dollar if you are buying the u.s. Dollar right now I think against the canadian dollar. I think now is a decent time. I think probably for me Maybe a round I think the uh the best area would be the about the one two sevens if it can get down there, right? Nobody knows but if it does and you really think that the u.s. Dollar is a is a bargain against the canadian dollar Then that would be where you're looking to uh to buy uh new zealand dollar u.s. Dollar Uh new zealand dollar struggling at the moment against the u.s. Dollar that is and um Makes sense in a risk-off environment Commodity currencies don't tend to do too well against uh the dollar but um and again for me it wasn't really it's not really a Pair that i'm interested in taking although i am a buyer of the new zealand dollar against some other currencies That did say and been saying for the last couple of weeks that you know If I was going to be a buyer or seller my bias would be to the downside and you're seeing pretty much You know what has uh been happening now. We've got a bit of a pull back into some supply So if you are looking to get short here, that's a decent area. I think the one uh, sorry 0.625 areas I think is probably a nicer zone To get short if you want to get short on that from buying perspective I would probably rather wait for price to I mean there is I guess technically there is a demand zone here because it has made higher highs higher lows So in fact, I will draw it It was a demand zone, but um, I don't think it's necessarily a strong area of demand but Um, it could be right, but in the way that I trade I really want to see some other things just play out before if I was looking to buy this Um, namely I would want prices to really go kind of higher improve that there's demand Then pull back to that that demand zone and then look for to be a buyer if I was looking to be a buyer of the new zealand dollar us dollar Moving on to the pound dollar pound dollar again just keeps going lower, right? And uh, technically, um, I really want to be a buyer of the us dollar And short the the british pound somewhere around here, but we do have Liz trust Who is our new prime minister? her energy bill I get price cap may rescue uk inflation and it has And it may inflation may peak right so economists say freezing power and gas bills will cut inflation, which is basically what they The economy needs right so stimulus now points to higher rates for longer economists say so Economists at Barclays Beerenberg and Bloomberg Economics said trust is packaged to rain and soaring electricity and natural gas prices Would have a sweeping impact on the uk economy and may manage to arrest inflation at july's reading of 10.1 percent so Um, you know the forecast underscore the importance of surging The cost of living squeezed to the outlook of the uk by halting increases in utility bills The government could stop the biggest upward pressure on consumer prices giving giving the both consumers And investors breathing room To adjust to other pressures pushing up the cost of goods and services, right? So if consumers You know as far as like myself paying less on energy and And and food and things like that or energy in more specific Then it can you know help The cost of living crisis. That's basically the point in that and there was something else interesting in here Was it here? I think um Yeah, there was there was talk about, you know Barclays said inflation would fall back to 5 percent in 2023 And it says capping energy prices would provide a welcome help to the bank of england in regaining control of inflation dynamics Montague wrote prolonged hikes next to Inter next year are now less likely in our view, but there was something else in here that I thought I had uh highlighted when was it where was it? Yeah, maybe it wasn't in here, but um, but yeah, so So, uh, that's that's uh, that's pretty much it. I think um Uh, you know, I think the the fact that The the bank of england, um, you know if inflation does start to come down the bank of england They're probably likely to you know hike less um, and In fact, it could improve the economy And so if the data starts to come in that the uk Actually may avoid a recession as unlikely as that seems or maybe not go into a deep recession Then in fact the pound could be a potential buy But for now against the us dollar, which is I think because I'm much better footing I do think any pullbacks uh to that supply zone for me are really decent the 118 levels I think are decent uh shorts Um right now again going long on the pound. You're really going long into um into a historical level Yeah That happened in 2020, but um Um, I don't think for me. I think that's probably more profit-taking as a reaction Um, but who knows right in terms of you know buying a pound for me There's not enough fundamentals for me to buy the pound At this area here because if if the market doesn't like liztrust is um, you know What doesn't think that her policy is going to you know, um Help the economy or as much as you know is Is perceived then the the the pound is still going to be um, it's not going to be a bog in here Is it you know, it could fall further? So For me the path of these resistance is still continuing to the downside and so um against the dollar anyway And that's where my continued bias is And um, if you guys want to you know find out a bit more about fundamental analysis, um I am actually closing up a shop soon as far as enrollment 11th of september is when I'm going to be closing and not only do you get access to you know all the advanced supply and demand Zone strategies that I teach um as well as capture pain relief stock hunts member only discord trade room access which is here um as well as um a fundamental analysis spreadsheet and really you know It's it's all about you know the mentoring because as much as um, you can um look at these things by yourself and watch You know a hundred a thousand videos Unless you have somebody really to hold your hand and guide you through, you know What is going on on a on a daily and weekly basis? Um, it's going to be very difficult for you to kind of make it by yourself There's only so many videos you can watch right how many videos have you watched on technical analysis? But yet you're still here. Um, you know chasing your tail trying to figure out how to be profitable in trading. So Um, you know the mentoring group is not like an other other chat rooms where you can come in and start You know people just chat nonsense. We're very focused On our fundamental analysis and technical analysis and if you do feel that you may need Some coaching and some mentoring Personal as I do have a weekly calls as well live calls on a wednesday These are also recorded This is one of our private pages where Trading 180 videos as well where every wednesday We have a group call. So last one was um on the 7th of september Which was here and we spoke about what is priced in information overload reducing rates and thinking in terms of versus thinking in terms of weakness bank of japan intervention You know the pound of buy and I put a question mark for me It's not but people were asking that question. Um, and lots more as well. That's a two hour Live group call so you can ask me questions Here's one here as well as just, you know, some other daily videos that I produce as well So um and weekly videos that I produce so lots and lots and lots of content on top of, you know, the course You know as well from a from each From each discipline so supply and demand trading course right there capture pain relief right there channels And you've got stop hunts fundamental analysis loads and loads and loads and loads of content So if you do want to join um 11th of september will be a deadline If not and you want to continue to watch my videos, I definitely advise you to go through my, you know, free youtube stuff. Um, and uh And if you want to join next time or not, you know, I definitely will I look forward to working with you if not, then I do wish you all the best in your trading endeavors anyways, let's get back to the charts And uh, let's go to the euro dollar euro dollar Euro dollar i'm actually in short on this um and as are many of the guys in the trading room It's a setup again that not really going to go into on the uh in this videos beyond this video, but From a fundamental perspective um, we did have The euro hike rates, right? And many people are kind of scratching their heads as to, you know, well, they hiked rates So why isn't the euro, you know flying off the shelf? Why aren't investors? You know looking to You know buy the euro and why isn't the euro going higher and Really, I mean, we've we've known this a trade in 180 That it's all really about the the economy and the energy crisis. That is what is really holding the euro back. So The euro trading is not about the energy crisis. Yeah, sorry. It's all about the energy crisis not ECB rate hikes So the euro fell below the dollar parity after the ECB rate decision The ECB is fighting gravity in FX markets says danska bank, right? So danska bank As many as many other banks are the big money And one of the quotes, I guess like I kind of wanted to show you guys was Where was it now? Uh, yeah, it says it said that the Oh, where was it? There's a quote in here. Uh, the ECB is fighting gravity in markets. It's christopher kejar holmholt uh head of FX researcher at danska bank euro dollar has more downsides in so and ECB decision does not change that and um, it says the rate the rate announcements Uh, um, it's in sorry in its race rate announcement that ECB struck a hawkish tone saying that expects to raise rates further um Raise rates further as inflation remains far too high. Um, and it says down here We do not target. No, where was it a euro strategy? So united in their predictions that the way forward is more weakness. Yes, the more weakness for the euro danska banks lohmholt said Fair value for the currency is closer to 90 cents compared with current trading around 99 cents I suspect that the ECB will have to produce these big heights just to hold the euro there So steven barrow an FX strategist as standard banks. So, um, you know bank quotes, you know, these guys are The smartest guys, right? way smarter than us And so if they're saying that potentially, you know, prices could actually fall down to the 90 cent area There's about a thousand pips from here. So, um That all obviously depends on the energy crisis and whether, um You know, russia will turn off the taps and um, there's an article which says a short says germany prepared for russia gas halts over ukraine So again, they have to prepare for these things. There is there is a Something on the horizon and again, nobody knows, right? The euro could be at least a short term buy if there's a resolution with With russia, it doesn't look like it is probably unlikely. But if there is or it's, you know, they managed to kind of Help the economy somehow and you know cap gas prices without having other effects on, you know inflation, etc And the economy then um, then that would be great, but It's it's um, it is an it is a possibility, right? So germany has prepared for russia to largely cut off gas supplies because of the war against ukraine So and it doesn't look like the war is um, doesn't look like the war is uh, is is is going to end anytime soon. So um Yeah, when it comes to The euro for me at this present time With the all the uncertainty around the euro for me. It's just no brainer to go To go short, right? Could I be could I be wrong about this? Yeah, if I'm wrong, it's okay. I'll just lose one trade Right, it's not the biggest deal in the world um, but you know, nobody knows what's gonna happen, but Um, it looks like the path of these positions is to the downside now that could change temporarily um If they do manage to find a way Some sort of resolution and I do think that the euro will rally either way though for now, um, still to the short side if you are going short then any pullbacks to a um, a supply zone daily supply zone like the Around here or the one of freeze. I think of you know, very good levels to look for potential short trades um If you are looking to be a buyer of the euro then any pullbacks into the 99 cent area Is probably going to be your best bet and taking that chance and that gamble right in in the fact that the euro will come out unscathed On the other side of this conflict and the economy um looking at the ozzie dollar and ozzie dollar was saying Last week and week before that. I do think that technically I do like this level Really nice level, but for me it would be very hard to buy The australian dollar against the u.s. Dollar Um, I'm a buyer of the australian dollar just not against the u.s. Dollar. So, um, yeah, it reacted from a technical perspective Which was uh, I wouldn't say surprising, but I think the the australian dollar they did high crates and they had decent GDP numbers as well. So that actually helped with um, you know price Stabilizing here. I guess if you want to call it stabilizing but it was a bargain really here and so, um, you know, uh, if if it was going to go any lower Then that would have meant probably that the australian dollar would have been seen as not a bargain here, right? But obviously, uh, what's helped the australian dollar maintain its bargain Value around here my buyers temporarily. I guess I've got involved in this and um, is because of the recent fundamentals so Um, yeah, I don't really have a a bias either way. Um, in terms of me trying to trade this but Um, if I did if I did then it would still be You know, I would say buying the u.s. Dollar But I'm not looking to, you know get involved in this trade But if you are I think now it's a okay time I think the top end of this, you know, the 70 cent area is probably the best area to look for For short trades or say the best area, but it's a decent area and even better would be The 71 around a 71 cent area If you were looking at getting shorts getting long, obviously you'd have to wait for a pullback Into the back into that, you know 0.675 67 and a half cent area before looking at getting long Aussie yen and Aussie yen again just that the yen is a as um Devalued um, uh this week had an effect on obviously the Australian dollar And um, Australian dollar Japanese yen and now we have Really a decent area to look for any kind of long trades now Again, I think the market really is ignoring. Um Any kind of risk off sentiment so, um Yeah, I think any pullbacks into this zone You know the 95 area, I think it's actually a decent, uh, you know decent buy for the Australian dollar Providing that again the Bank of Japan doesn't come in and start to intervene into markets And then for me, I think all bets are off when it comes to buying or trying to sell the yen And buying anything against the yen until really the dust is settled So any pullbacks into that demand zone for me are decent and Gold right gold Of this, you know Historical level over the past is type several times matter of fact. So for me, I'm not Looking to trade gold so much as I am looking to you know buy in terms of the physical metal But I do think that this is going to be a bit of a long-term play I think as the dollar starts to strengthen if it does strengthen, right? Let's say for example CPI comes out And it goes higher And then the Fed raised by 75 basis points um Then I do think that gold Potentially could still start to drop A little bit more but at these beyond these prices. I think gold is an absolute Steel in the coming future central banks. There was an article I couldn't find it before I recorded it, but there was an article Again another article because I think I posted one earlier in the year about central banks increasing their gold holdings. So that's become another recent report so Central banks, you know, I'm not increasing their gold holdings for for no reason, right? You know, so for me I think I'm just buying any any in and around this area for me is Is decent is definitely a decent prices again Not financial advice not telling you to go out to buy physical gold or trade gold or anything like that If you don't want to trade it, don't trade it, right? If you do, but you're unsure then still stay out, right? but The point being is that for me my bias actually long-term bias is to is to go long gold my short-term bias Is as long as the dollar continues to Strengthen then it just pushes gold down to cheaper prices, right? It just continued to push gold down and made this may start to Break and again the more times the level is touched The less of a bargain it becomes right because it becomes now common price So don't be surprised if you see gold actually break this this level and come down to maybe this longer term Demand zone just below it, which is from April 2020 the 1647 to 1656 area So, uh, so yeah, but if you are looking to potentially get short on gold Then I think the nearest area to look for short trades is going to be beyond that monthly moving fair value and then back down into the Um, I'll back up into that supply zone before looking at, you know, continued short trades anyways guys, that's it for this week again. Don't forget that the trading 180 Enrollment closes tomorrow. So if you do want to join, um, you know feel free to join and reach out to me if you've got any questions and If not, I wish you all the best have a great trading week And I'll speak to you all soon