 Hi, my name is 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 if you're new or warm welcome to you in if you're returning and equally warm welcome to you And if you like the analysis that I do every week, please don't forget to like subscribe and share definitely like and subscribe just a free way to support the the channel and and Again, if you're new Really our trade process will separate trading 180 from you know, the vast majority of other I guess weekly analysis videos that you might see on YouTube Facebook, etc is the fact that we employ combination of fundamental and technical analysis and our fundamental analysis approach isn't what you would typically see From other traders where they're just looking at forex factory data points. What we do is we look at We establish value through Macroeconomic data like inflation interest rates and looking at the business cycle GDP as well as monetary policy and risk sentiment and then we can go to our technical analysis and use a combination of supply and demand strategies like capture payment leaf and stop hand strategies to enter with a high degree, I guess of confidence when entering into trade so What we want to do first this week is really kind of just start off on what's coming up in the week ahead from a news perspective and then get into the fundamentals and technicals on each chart so looking at the week ahead and We've got the US releasing the second estimate of the fourth quarter GDP alongside durable goods orders personal income and outlays and PCE price index. So the fourth quarter Second estimate the first estimate came out. I think around about 4% So the second quarter estimate shouldn't be too far away from that other GDP Updates to follow include those from Germany, France, Switzerland India, Hong Kong and Mexico elsewhere the Eurozone business survey and Sorry, the UK jobs report will be keenly watched. Yes jobs report is definitely something that we look towards as well as High unemployment means or higher unemployment means more of a recession and lower unemployment means Growing economy potentially So as well as China house prices Japan industrial production and retail sales and Australia's fourth quarter construction output Central banks in South Korea New Zealand will be deciding on monetary policy So if you change the New Zealand dollar, let's you know, see what the what the RB NZ have to say about What their future guidance will be whether they're hiking holding cutting rates what they're concerned with Introducing more QE or holding QE, etc as that has an effect on the value of the New Zealand dollar Which has been a bit of a tear as of recent so moving on to the US dollar index and Dow Jones dollar index And so what we saw pretty much last week We did see a bit of a gap up on I think that must have been the Wednesday Thursday Friday yet And we pulled back into this demands and really just did the dollar index is just a measure of dollar strength against the basket of currencies like the euro the yen and the pound and So this week we did have you know bit of upside down side But overall I think in the short term and when I say the short term I'm talking about maybe the one to three month period I think that the market is likely to range Yeah, so I don't know exactly where the market is going to range from who knows nobody knows But I think between this high here and this low I think the dollar index will probably start to range because there's been some good news out regarding the the the dollar And in fact, it could rain from here and here as well. So For me I use this as confluence and if there is some bullish price action on the dollar index It means that overall dollar strength should be coming into the market And then you want to go to one of the dollar crosses like the dollar yen dollar Swiss to look for potential confluences on your buy trades. So There is obviously some news again, like I said coming out this week regarding the week ahead So four quarter estimates, but I do think that should potentially be positive. Also, we did have last week Just we just gone US economy surges into 2021 is sells output tops forecast so There was some US economy started 2021 with a bang as retail sales In fact to be up accelerated and expectations continued to build for another jolt of government stimulus setting the stage for what could be the best year of Economic growth for nearly four decades. So You know expectations for gross domestic products Growth increased for the first quarter and every subsequent three-month period Through mid 2022 according to the most recent monthly survey of economists by Bloomberg News Economic growth this year is estimated to be the strongest since 1984 when Republican Ronald Reagan was president So that should be a tick in the column of why you may want to potentially look for buying Opportunities for the dollar because if the dollar starts to strengthen and as far as the economy Starts to grow then there will be demand for the you know dollar And then what you want to do is really just look to Trade the dollar against another country and currency that potentially may not be doing so well That's what's known as a divergence trade your trading divergence is why one country is doing well You want to buy that country and currency and then you want to sell a country that and the currency that isn't doing too well, so It's been some positive news surrounding the the dollar as of recent And the prognosis of vaccine surge is coming with millions of doses promised So new supply should help the pace of vaccinations double in the coming weeks again. Why is this? worth noting in this but really because if you have the population being vaccinated then you have less I guess the spread of the Viruses contained and then that affects GDP because people can get back to work some sort of normality if you still have the fear and the spread of coronavirus and you have you know continued lockdowns then your Economic growth and growth domestic product is going to be delayed. So One of the reasons why the pound has been surging recently in recent times over the past You know a few months is because of this exact same thing and we're going to that when we get into the pound so The US for me potential buy again Nobody knows exactly where all we do is we just Understand that if this is a bargain and the market agrees with us that this area here is a bargain for the For the dollar then brilliant if not a price as you know Dollar index comes down into that area there then that's definitely going to be a potential bargain depending on obviously if we still have some decent news out and the fundamentals Say so because price is not value and value is not price people get this confused You can have something that is undervalued. Yeah And you only know that you really only know that if you understood what something how to determine value so Price can come down. Yeah, but it just means that you can get in at a price, right? That's what you're supposed to be doing is as traders Is understanding value price action is not king because price can be manipulated and prices manipulated every day So how can something that is manipulated be the king? It's not so Just Understand that if this level doesn't work if the dollar doesn't necessarily you know go up here It means that a lot of the big banks Potentially are looking to buy the dollar cheaper, you know, and that's you know the theory So you've got a lot more potential upside Yeah, if that does happen if you don't believe what I say and again This is not financial advice anyway, but you have your own fundamental analysis and own opinions on the dollar then What you're looking for is sell trades you're looking for short trades back up into That area of supply if you get that confluence, of course You're not trading the dollar index just looking for confluences or if price does do something like this Let me just delete all of this this analysis. It makes lower highs and lower lows So let's say for example, it breaks through that area of Demand then you pull back to an area of supply which would be here And then you're looking for that confluence So for me again dollar continued potential buy for them for the short term one to three months probably and there's something changes and Yeah, let's look forward to now the dollar yen and The dollar yen, you know, it's past a week or two has made, you know, higher highs We've got a bit of demand right here And in a risk-on scenario, we usually the the currency with the higher interest rate should win and The Japanese yen interest rate is actually minus 0.1 at the moment and I think the dollar is actually 0.25 So you've got some, you know, if you're looking in a risk-on environment to make a return on your money What are you going to be looking to do by the Australian dollar? Got it on the brain. The US dollar or by the Japanese yen It's gonna be a dollar all day long. So With that being said If we do get any kind of pullbacks into a nice demand zone, that would be a decent buy Again depending on the strength of the dollar because there is this overarching Sentiment that the dollar is potentially getting weak as it stops coming really the the global reserve currency And there's a shift the way towards the dollar dependence So that is the overarching and the really kind of the medium to long-term view of the markets But in the short term doesn't mean in the short term that the price of the dollar can't go, you know higher so Let's see what happens there If risk off does start to come into the market and the Japanese yen is a safe haven currency Then what you're looking for is a pullback into any kind of you know Supply zone a bit higher and then look for any kind of a short trades Moving on to the dollar Swiss And the dollar Swiss I'm actually in this this this trade that got involved in and around this area here So let's see if prices can continue to go, you know higher And I do think the dollar should want to go higher against the Swiss Frank, but who knows Again a nice demand zone where price, you know made new highs a strong demand there And then pull back into that zone and then we had a really nice Opportunity to get long Now again, nobody knows how far prices will go But it just depends on whether the market agrees that this is an absolute bargain And if it does then we're just getting a bit of a pullback before potentially moving higher Again, if if it's a case of you know prices do pull back this week and you know come down here longer term I do think that the The Swiss Frank is very expensive and the Swiss National Bank have actually said themselves that you know They're intervening and they also want a cheaper Swiss Frank So they want prices to actually be up somewhere around here In fact, they wanted to be all the up here if they can so let's see what happens With with the Swiss Frank and the Swiss Frank is a risk-off currency meaning that if there is Uncertainty then it should want to strengthen So I think this zone here is actually a decent area to look for some short trades If risk-off does come into the market So the thing for me the ultimate buy for the dollar though is going to be down into this 87 That's where that area there is is really really really nice for a potential buy if we can get down there Moving on to the dollar CAD And the dollar CAD we are really at some you know some some lows We haven't seen these lows since 2018 April 2018 so Depending on you know the CAD for me was always a there's always been a buy since we know we're are in a risk-on environment Canadian dollar has been going from strength to strength But do you want to be a buyer of a Canadian dollar in the round here? Probably not so The two ways to kind of look at this would be either I think what I have to do is move this down here because we actually have made lower highs and lower lows So we've got a bit of supply there The first area to look for any kind of short trades would be in here And then you know if you're looking at obviously looking at daily supply zones But then going down into the lower timeframes and looking for trades That would be the first area to look for personally are really kind of prefer Prices to come all the way up to here before looking at getting potentially short But also as well on the flip side if you are looking to buy the dollar if you're looking at dollar strength Then in fact this is a really nice potential buy trade Set up or area anyway that you want to look for a potential buy because this was a bargain back in You know January and if the dollar is going to potentially strengthen Then that should be a decent buy technically from a fundamental perspective. I'm not really keen on on buying the dollar against another strong currency like the Canadian dollar so For me doesn't matter what the technical setup is fundamental it's got to have some fundamental confluences and Yeah, that's that's what that is. So what you saw here this week is a move down Yeah, and then the move back up more selling You know a nice a nice day trade right there But for me, I think that's to put it the limit of the move or what you probably want to see is You want to see proof of value so price to really kind of break through that area to prove that the Canadian dollar is an absolute bargain there and the pullback into some sort of supply zone and then look for some sort of short trade That's you know how I would play that Moving on to the New Zealand dollar US dollar and if you can come up to a nice a really nice high And this is going to be you know watched by a lot of traders because this is really the 2021 highs Yeah, so this is the high of the year so We do have again the the central bank of New Zealand Derby and said coming out and guide and basically looking to guide Monetary policy now if they come out as very dovish or surprise the market then you could see actually a really nice short trade and I think as a technical setup I'm always looking to buy at you know say always but my technical analysis perspective I really like the the highs and lows of range. That's that's really the optimum trade Going into From a buy trade perspective for the dollar the US dollar then you look I'm sorry New Zealand dollar if you do get a pullback would be somewhere like here But this would be a nice trade for the US dollar if we can get some dovishness for the New Zealand dollar and Again some positivity around the US dollar this week Moving on to the pound dollar and the pound dollar Prices came up into a bit of a supply zone, which basically was created in May 2018 and as I you know always say that What you want to do is when it's a plaza own has been created from you know years years ago Take that with a pinch of salt and the reason why is because whatever drove prices down here Yeah, it's not going to be the same thing fundamentally or risk sentiment wise that is going to drive prices down here So you have to be you know aware of that The pound again has been on a tear and it's really been mainly because Of the vaccine rollout so that the market is always Future and forward thinking so It's always thinking about what's focused I guess on On the next you know three to six to nine months is not really focused on what what is now is by the rumors of the facts so if the rumor is that You know the the UK are vaccinating there Rolling out the vaccine ahead and on schedule or you know A head of everybody else then that just means that they should get their economy back on track soon Then everybody else which then means that the market is is pricing in that that that scenario so Stirling is the best performing major currency this year and the UK assets have benefited from a swift Vaccine rollout. Yeah, so again the pound surge for one One dollar forty for the first time in nearly three years as investors bet the UK's rapid Vaccine rollout will help pave the way for a reopening of the economy this year I've been saying this we've been in the group in our private Discord group. We've been saying this since last year that this is you know been the This has been the one of the plays the other thing about the the pound though Which has made it really quite difficult to trade in fact is this Switch to negative interest rates and whether they will or they won't so even though yes The pound has been on a tear. It's been a difficult trade to to really take because You've had the Bank of England or members of the Bank of England talk about negative rates, right? So BOE's I think he pronounced it for leg heel the leg gives Strongest backing yet for negative rates and negative rates and this and this this Gentleman is a great setter. Yeah, so his opinion matters And he says that there's little QE can do to add stimulus and prefer subzero rates for dealing with labor market weakness. So This this this policy maker is Voting member and if he's voting for negative rates That isn't good for or say that isn't good, but that should have an effect of weakening the pound Yeah, so an expensive pound during a recession is not desirable In fact, people think that a stronger pound is good, but it actually isn't especially when you're trying to recover economically so There's there's a there's a really a Battle going on within, you know, the Bank of England the board of members the board members Regarding the strength of the pound the recovery what traders think and also what the Bank of England think and how they're gonna balance the economy in jobs Because like I said to make the the British and UK economy competitive You're gonna have to have a weaker pound and the strong pound isn't great. So Negative rates are, you know, or basically Bank of England has resisted global rates pushed below zero like, you know, like Like Japan ECB and Switzerland. So Yeah, it's been it has been a tough trade if you have, you know bought the the pound And traded the pound higher and higher, you know, well done for holding that trade. It has been a bit of a tough one But I think overall This is coming really to I think the limits of its move So if you do want to get short on the pound and I'm gonna delete this supply zone What you want to do is, you know, look for You know proof of value proof that there is supply here and then look for some sort of, you know trade back up to a supply zone which is which gonna be right here and then look for some potential short trace because we've Been in a trend for since, you know, since Since early September this this up move and markets go from Trending markets to ranging markets or accumulation phases Whatever you want to call it. So at some point this the market has to, you know, agree where roughly price is and it looks like 140 was, you know, a target. So let's see if we can get some sort of ranging market If we do range then where we're gonna range from and this may be, you know, the area where you want to look for a ranging Ranging type set up if you're looking to continue to buy the British pound against the US dollar Then it's basically a pullback into one of these demand zones. I probably prefer If I was looking to trade this probably something down here You've got some support and resistance as confluence Down into that zone right there. So this one three seven six area Moving on to the euro dollar and the euro dollar. So again, a bit of a tough one Not the clearest of divergences, but there is in my opinion a divergence there between Europe and the US and as we've already gone through the US is actually doing decent yet the Euro area is Weakening or weakened by lockdowns supply constraints. So regions factories have been a stronghold for strongholds through the crisis firms becoming increasingly upbeat about recovery projects But business activity in the euro area Your economy shrank for a fourth month in February as services struggled with continued lockdowns and factories ran into increasing supply constraints, so There's again some divergences going on there As well as potential rollout of the vaccine. So again supply constraints So where you've got one country that potentially is looking to To grow you've got another country that potentially may be a bit offside when it comes to their GDP or lagging when it comes to GDP so With that being said if I'm looking to potentially buy the dollar and hopefully there should be some good news or there is some good news and You know Europe is lagging behind then the idea is hopefully we see prices continue at least to the downside Who knows what's going was what will happen? But you know, that's pretty much the idea We're already a lot of the guys in our group Private group already in this trade to the short side and let's see, you know, what happens Here and again, if that's that doesn't work out, so it's okay It's only one trade you're looking at, you know a bit of a fresher area around this one to two area Price zone to look for short trades And if not then you've got that and if that if your idea is correct on the euro strengthening Or sorry the dollar strengthening against the euro and the euro weakening against the dollar Then you've got a lot of downside potential for that to play out Really nice trade to the short side if Europe does start to grow though And things turn around for Europe the European economy in in the short term Then I honestly think that the euro is definitely a continued buy So I will switch my fundamental bias and directional bias depending on The overall fundamentals So I do think that if prices do come down here eventually And let's say for example, we get some really good news out in Europe then in fact, I think The euro the euro may be a potential buy but for now short term wise. I'm looking at Short trades on the euro dollar Moving on to euro yen and the euro yen We've had all that zone didn't you know really work out and that was Probably due to again in a in a risk-on environment You put in the euro is the one to buy so it doesn't matter how much technical confluences you may have If you know the the market sees The value of the euro is being higher. There's no technical analysis going to stand in the way of that So what you're looking for now is pull back into a demand zone if you want to get long on the euro That's quite a that's actually a very nice zone to get long on if you're looking for short trades And you're looking for again a pullback for supply to appear somewhere around here That would be where supply would be and then you're looking for a pullback into supply After it's done it to move and then looking for a short trade in there So Aussie dollar has gone again from strength to strength. Look at this The australian dollar has really been a buy and again the guys in our in our in our discord group Have known about this for quite a while. We were long on the The australian dollar from like last year october november Once the the risk-on sentiment came in the vaccine rollout and in fact Going back to you know a post or two from the 24th of november where we were talking about the the The australian dollar and there's an article or one of the many articles that we were we were looking at for example buying The australian dollar and it says the boost of the global economy economic growth in 2021 Should benefit the australian dollar says analysts investment bank Goldman Sachs who have told clients the currency Buying the currency forms one of the top trades for the year ahead So this was last year and this is not just one analyst saying this it was several analysts saying this which we done our research And we understood why as well. It's no just it's no good just looking and reading what analysts say You have to understand as well why that you know play is gonna, you know Uh Is likely to take shape right so from you know This was like 24th and you've seen pretty much what happens here and again Nowhere will you see nowhere? Will you see him mention anything to do with elliott wave? Or um, you know any kind of fibonacci trades. It's all fundamental analysis. Yeah, it's talking about He talks about commonwealth currencies Right tend to perform well when the global outlook improves due to their relatively high exposures to global trade both canada and australia Are handled in covet fairly well and their central banks should be done cutting rates all fundamental analysis Nothing to do with the technicals. So our technicals should be used as just a way to you know, enter your trade once you determine your fundamental bias Yeah, and these are the smartest guys that are saying these things not you know These these so-called um technical analysis Guys who just literally think that um, you know fundamentals don't work. They just don't know how to trade the fundamental analysis so when you've got situations like this Going on doesn't mean it's going to keep going higher etc Because there is potential strength for the dollar coming in So just be you know be mindful of that but overall That is going to be the buy trade if For example, we do get something where we get proof of value for the US dollar then this actually if the price is kind of do something like this and then come back to that zone That would actually be a decent selling opportunity as well Because again, we've been in a trend for for for for quite a while and it's strengthening US dollar Could lead to a ranging market so But we'd want to see that you know On price first and play out on price first before looking at getting Short because if we look back there's really no major levels Or no major supply zones that i'll be interested in. I really want to see proof of value first Before looking at any type of short trades, but the path for these resistance at the moment is to the upside So this is going to be your first area to look for any kind of long trades and if prices do come down here That's going to look like a bit more of a bargain Aussie Yen and Aussie yen again same thing. This was really the trade Aussie dollar. I'm sorry Aussie yen Really really nice trade and again in a risk on environment when Everything is when investors are looking for a return when there's a lot of you know certainty Then that's brilliant and a risk off environment Yeah the The Japanese yen does well because it acts as a safe haven when there's lots of fear uncertainty, you know in doubt so But you haven't seen that with the vaccine mold out global recovery. This is why you see prices trend So what you're looking for is a pullback into that zone there or you're looking for a pullback into zone there or Even a zone here. So again if prices do come back into these zones And the fundamentals are still the same then just look at it as More of a bargain price for you to get, you know long on those trades because again price is not value And value is not price Looking at gold So gold finally, um, we have come down into an area very interesting area um for gold now There has been fundamentally On sick here we go. So gold goes from a star commodity to laggard in shocking reversal quite sensational But gold has began the year with lofty lofty expectations on the back of Record highs and its biggest annual gain in a decade instead the precious metal is off to the worst start in Years, I mean that doesn't really you know mean anything what really you should be looking at is understanding Things like inflation if you believe that inflation, you know, it's coming back Into the market and what is inflation inflation is really a high inflation or higher inflation is is currency devaluation Yeah, um, then gold is a hedge against inflation. So, um, yes in the short term You may have this start to happen But for anyone who's who understands the longer term game, this is an absolute bargain and when you think about That where gold was a bargain from last year So prices contained between this low and this high all we've had is a pullback to what is known as fair Value, you know between an expensive area because that was obviously expensive for gold If it wasn't expensive then prices would have went higher and this was an absolute bargain area And if we understand that to be an absolute bargain because prices went higher you can proof right proof that this wasn't actually Bogging so between an expensive area in a bargain area is fair value. So all we are really at is is a fair value area. So Anything below this if you consider, um, you know, the fundamentals With with the amount of money printing that's been going on qe going on, right and the devaluation of currencies If you're still a believer in that and you want to, you know, trade that analysis Then, um, this is a decent area to look to load up on gold and the cheaper you go Well, the more prices go down is the more that this looks like an absolute bargain because anyone who didn't load up last year Yeah Um, or anyone who's basically cost averaging down everyone who bought here and bought here And then basically all you do is your cost averaging as you count as prices go lower Yeah, um, these are seen as as bargain areas right bargain If you again believe that there is, um Dollar devaluation currency devaluation in general and yes, I do believe in the short term that the dollar may want to You know rising value, which is, you know, probably causing something like this to happen Doesn't mean that you know because the dollar rises that the goal is going to go down You can have gold and the dollar go up in, you know in price at the same time But the point is is that fundamentally what is driving gold at the moment could just be, um again short term sentiment, but look at this as a if you are anyway, look at this as a potential Buying opportunity for the for the long term or for the least the medium to long term so let me just clear somebody's analysis up And again, this is not financial advice. It's just my opinions. Um, please do your own research So a really nice buying opportunity. I think here And uh, if you are looking to continue to sell gold, then you are looking at this area here for a sell trade So there's supply there So that would be the area to look for potential Short trades, but for now, I think this is decent if this price does come down even to down here It's just going down into the lower time frames to look for some technical setups if you haven't got involved in You know anything around here. So, um So guys, that's it for this week again, please don't forget to like subscribe and share with your fellow trading colleagues Um, and until the next video. I hope you have a great trading week. Take care