 Hi, my name is Leon Roe come and see trader and trading culture trading 180 calm We're welcome to this week's supply and demand forex and gold fundamental and technical analysis If you're new or warm welcome to you and if you're returning unequally warm welcome to you And don't forget to like subscribe and share press that like button right now press it press it press it Because it really does get this quality Forex trading content out to the traders that really need it and against a quick reminder as to What we do at trading 180 It's really apply fundamental analysis to establish our directional bias and then apply technical analysis I'll supply and demand strategies to time with trade entries risk management and established profit targets So fundamentals first and then the technicals. So let's get into I guess the the upcoming news events for this week and we've got quite a lot going on so week ahead was something important news anyway The week ahead the US CPI report is likely to show The inflation rate will hit a new four decade high crazy So money's being devalued the money in your pocket is being devalued at the moment Well, if you're in the US, I guess it's all over the world high inflation But also the the UK will release the fourth quarter GDP growth numbers That's going to be important that fourth quarter GDP growth number and central banks in India, Russia, Indonesia, Thailand and Mexico Okay, we don't really trade those currencies or not watching those anyway Meanwhile market volatility is set to continue amid increasing bets of a more hawkish fed stance with Chinese traders returning from that long week holidays so Market volatility right more hawkish fed especially if inflation comes out to a new Decade higher right for decades 40 years Crazy so anyways Let's get into You know, so that I guess the technicals and most focus on I guess the dollar first dollar index Which is just a measure of dollar strength against other currencies like the euro the yen and the pound And we use this as confluence to keep an eye on this and what's happened last week is if we had a bit of a pullback I guess made a new high from from this low here So prices have come back into that zone didn't really react to it as much But again, if you do see, you know prices do start to react within this area start to push higher for example That gives a decent indication as to maybe you want to be a buyer of the the US Dollar, but I'm a buyer of the US dollar for fundamental reasons regardless of what the technicals say in a short term and really it's mainly because We look at central banks and I guess ING a Dutch bank You know looking at basically that the central bank forecasters to what they're looking to do with monetary policy I interest rates and quantitative easing It's a general rule of thumb You really want to be buying the the central bank that's looking to hike rates and Against the central banks that are looking to not hire a hike rates, right? because hiking rates generally should have the effect of Appreciating a currency, but there's lots of central banks that are looking to hike rates So which one is you know the ones that you should be buying and again? It's not financial advice But the ones that you I typically look towards to buy the ones that are hiking more aggressively than others, right? So for example with the euro dollar And we'll get into the euro in a sec But you can see with the euro dollar you've got the Federal Reserve hiking Once twice three times projected five hikes this year, right projected five hikes in the Within these are fourth quarters for quarters. So I am compared to the European central banks one so There are rumors around the central bank the European central bank looking to hike rates at some point potentially coming into the fourth quarter although ING think it's going to come in the first quarter, but Ultimately the Fed are looking to hike a lot more So the path of these resistance should still be really to the downside not to say it's going to continue trending down We could obviously probably enter into more of a bit of a ranging market And then you've got for example the Bank of England Bank of Canada Who are looking to again a probably bit more aggressively hike rates Bank of Canada more so than the Bank of England It looks like there are more hikes coming this year than the Bank of England. It looks like anyways Against for example the Bank of Japan who are not looking to hike rates at all and neither are the Swiss National Bank until the fourth quarter of 2023 which is the expectation So for me the path is really kind of set out in regards to what it is that I want to do fundamentally And then it's just a case of looking towards You know the charts right to see which where the where the bargains are on a chart on a price chart and What we had is some US dollar news the shock jobs US shock January jobs report confounds the doubters so the Omicron wave has depressed economic activity And this was meant to translate into weak hiring. It hasn't 470 so 67,000 jobs Created a massive upward revision suggests a fundamentally very strong economy With with companies desperate to hire and the biggest issue Being the lack of suitable staff wages are rising sharply and the Fed will respond some more wage problems as far as inflation problems But the fact that the economy is doing jobs or I guess An early indication of how the economy is doing The US is doing good. So we should say we but the Federal Reserve should They're going to think that the economy can support rate hikes So it just the data is confirming the narrative of rate hikes, right? So for me the dollar is a buy So it's just a case of looking at where you want to be a buyer Not necessarily on a dollar index, but if prices do start to come down in a short term This looks like it's going to be a really nice buy for the dollar anyone who missed out on this buy Opportunity when prices went higher I definitely going to be looking at that area that 94 95 to 94 60 area as an area to look for any kind of buy opportunity if prices do come down to this 94 round number 93 that's going to be an even better bargain, right? So let's see what happens with the with the dollar Moving on to the dollar index. I'm sorry the dollar yen. Sorry And so for me again buying the dollar because they're looking to high crates and the yen and not looking to high crates any time soon Really, I think for me. There is you know, the path of these resistance again is to the upside So there is a demand zone here, but I kind of hesitate to put it there The reason why it's not it's everybody's strongest area of demand For several reasons, but if prices do come back down to that area you can look for a Buy trade, but I would prefer this one 14 to one 13 50s area for a nice potential buy but some intraday I guess that's that's decent, but the first demand zone But I probably would more look like look for anything around that one 13 area even better would be the one 1250 Whether it will get down there or not is anyone's guess I'm not here to predict what price is going to do in the short term But I know in the long-term prices are likely to continue going higher in the medium to long term So any pullbacks are really kind of by opportunities for me unless of course we do get you know lots of risk off sentiment and money tends to flow into the Japanese yen and a risk-off environment so if You know the Russia and Ukraine tensions really does ramp up if there's you know a war that breaks out for example You may see The yen start to strengthen against pretty much all currencies to just be aware of that Moving on to the dollar Swiss and same thing with dollar Swiss looking to be a buyer at some point I think the best area for me would be anywhere around this 0.90 Area I think is a really nice buy of course you can start to look to buy in here But for me the levels have been touched several times right although this has led to a new high So this is definitely something that you have to consider Worth taking a taking a trade here, but ultimately I think the best prices are going to be down by the 0.908 level and again our direction is already established, right? I'm looking for higher Dollar prices or to put a dollar to appreciate definitely going to Swiss Frank in the medium to long term in the short term Nobody knows right nobody can predict So let's see what happens there if you do want to get short on the on the dollar there is I guess a short trade. I have some supply there as well So look for supply in and around that first zone there So there's definitely been a sell-off on the dollar buying of the Swiss Frank So if prices do come up into that 93 10 area there is a short trade right there moving on to the Dollar CAD and the dollar CAD Again to there are two Central banks that are looking to high crates right looking to high crates So for me, I don't really like trading in an environment where you've got two central banks That are pretty much neck and neck when it comes to hiking rates. So for me Again, not necessarily the best currency pair to trade if you were looking for a pair to trade I mean, I guess a direct since trading. It could be either right that would be the the sell trade And I think ultimately I think this might be the best buy trade or just above there would be a decent Short trade as well for considering this being an absolute high and it's being an absolute low Right, so price to contain between the high and the low which is a range value range and a value auction, I guess and So it's really you're looking to try to trade at highs and lows of potential ranges So the best there is to look for by trades guess you could look for here But this would probably be the better area to look for any kind of buy trades If you want to be a buyer of the US dollar or buy the Canadian dollar You're looking at probably somewhere now or even just a bit higher But not paid I'm really looking at dollar Pound dollar I should say pound dollar so The pound dollar the pound again are looking to high crates and a hawkish Bank of England raises rates And there's surely more to come so the fact that four out of nine Bank of England rates set as voted for a 50 basis points Rate hike rate rise at the at the February meeting shows that policy makers are keen to act preemptively amid high Deadline headline. Sorry inflation rates now. We expect further rates rate rates in March and May so that being said again You've got two central banks aggressively looking to hike the Bank of England are actually ahead of the the US dollar But for me, it's it's pretty much neck and neck which when you really want to be buying or selling right surprises didn't react To this area here simply because it you know, it's what obviously wasn't a bargain, right? But we do have established a nice demand zone there, which I do like So it's demand. So if you want to be a buyer at a pound I do think that this area here is nice for it technically anyways For a sell traders in buying the US dollar We're pretty much looking at this area here first touches of levels or maybe zooming out a bit. Yeah, possibly maybe Not necessarily the best area, but decent area. We're in a bit of a range. Like I said from here to here So prices are contained. We've got a smaller range between that area there if prices do range. So that 13790 up to 137 5 So let's just say 09 237 5 would be where the area to look for any kind of long or short trades But not really a pair that I'm looking to get involved in because there's really no trade divergences With the pound or the dollar Moving on to the euro dollar now euro dollar massive move up this week, you know The the central bank european central bank were actually meant to They meant to but they were expected to be a bit dovish But they literally turned around and were hawkish on this, right? They were very hawkish And it's something that I did mention in the in my private members group So on the second of february wednesday the second of february I said So I was saying to the group that unless the ecb turn hawkish I think the euro has pulled back to a decent short in also decent short in levels on certain pairs So going back again to to the euro and the second it pulled back to a nice Supply zone, right? So it pulled back to that pair. So I was thinking it's a it's a decent level, right? But unless they turn hawkish, so we were expecting why so I was expecting but I was Thinking that they could turn hawkish, right? There was a possibility and this is the reason why I said keep in mind At the ecb's tone will be based on future expectations of economic growth from rising inflation The more inflation rises the more pressure it puts on the ecb to have to appreciate their currency because rising inflation Is essentially currency devaluation. I am personally waiting until after the press conference To announce announcements to see how the market is interpreting a ecb's tone The ac the ecb may have to talk up become slightly hawkish If they see inflation as a longer term problem rather than temporary Remember that the fed thought that the us that the us inflation was transitory and And they were wrong, right? So the same thing could happen with europe the problem that europe has though is that gdp may not support hikes at the moment So I didn't think that they were going to I knew they were going to probably try and turn hawkish at some point But I didn't know it was going to be there But I was basically just waiting to see what was going to happen Also as well another thing to talk about in terms of currency strength the ecb do not want a stronger euro Right. They don't want a stronger euro the year if the euro continues to depreciate It causes inflation data to go higher and will only compound their inflation problem So I'm starting to feel that the ecb will have no choice But to start to be hawkish at some point this year now may be too soon for a hawkish tone But come second quarter third quarter. I do think the euro will be a buy keep an eye on jobs data as it will As well as the usual gdp for signs of economic recovery because it's at that point That the rumors will start regarding the euro appreciation central bank currency What it looks like what it looked like the The central bank got there before me right and got there got there before a lot of Banks because a lot of banks were weren't expecting a hawkish euro just yet, right? So that's the reason why you had this, you know, you have this price action happen right now so With that being said Buying or selling the euro dollar. Well for me I'm still a seller of the euro against the dollar that is but i'm a buyer against the euro Against other currencies like for example the yen or the swiss franc But is this the area to look for a short trade? Of course, nobody knows whether it will turn around. This is the reason why we manage our risk and Just basically say all right then take a chance, right? We've got to speculate because no one's going to know It was a bargain at this point in time as far as the the dollar was a bargain here back in january But that was when You know the ecb were very dovish and the and the dollar and the fed were quite hawkish on interest rates Now things have kind of turned around a bit the market has to revalue what the value of the uh The euro is right. So is this the area it's worth a shot, right? If you lose the trade or i'm telling you to take this trade But if you know you do enter this and you lose the trade are well So what at some point, you know, this could be the level, right? So with that being said, of course, this isn't the full strategy I'm giving you this is the very very basics of course the guys in my group will know exactly what to do Technically and what to look for technically but as you're you know, watching this free on youtube I can't go over obviously, you know the full strategy. So from the perspective of Just looking at You know where where the bargains are and where you want to look for potential trades You know, these are the areas that you want to look for, you know, the trade where i'm looking for the trade Anyway, um, and again, nobody knows, right? If you don't want to take that trade then don't take it There's other ways in order to wait for confirmation again the guys in the group know exactly what to do So if you don't want to take this trade and you're watching this and you're in the group You know, just go through the course and you'll see that there are ways to To enter I guess more of a conservative entry, I guess But I do think that at some point We will enter into some sort of ranging market will prices range from here, for example Nobody knows right or will prices range from, you know, that low to this high right and could that could be the range Either way, I think the dollar are definitely still more Hiking more than the Then the euro of course the euro would were network basically dovish and now they're starting to kind of be a bit more hawkish Which is basically the revaluation I don't think prices will come down to this one 111, you know any more I think the downside is definitely capped and now they're just trying to find I guess a bit of a price is trying to find a Value range an auction Fair value auction Between a high and a low that you know, it's going to be a greed whether it be here or here Nobody knows but if that is not the case and you know prices go higher Then it's just look for trades up here and obviously you've got a lot more downside potential The cheaper you buy the the dollar, right? That's just my thinking anyway So with that being said, I'm not really looking to buy the dollar against the sorry euro against the dollar That's not really where my my bias is So let's see what happens and remember as well The euro is it's just the rumor right the rumor It's not that say that they are they are going to do it also as well The data has to support the narrative because if the data doesn't support the fact that they can high crates So should high crates then the euro is going to be revalued again And that rumor is going to not have any really kind of merit to it. So let's see what happens But if you are looking to um, you know buy the euro, I guess the nearest the demand zone is going to be all the way down at the 11240s, right? So if you get you know prices come down here, that's going to be where you should look for a potential buy Um, or if prices make higher highs higher lows, then you're waiting for a pull back into that higher low To get long on that euro moving on to the australian dollar u.s. Dollar and Yeah, we had uh, I guess last week we did have Let me just get rid of this. We did have a reaction to that demand zone Which now starts to come down to here Um, and we did react again off of this supply zone I think for me the dollar u.s. Dollar anyway store a bit of a sell as they're looking to hike Rates so, you know, that was the first area fresh area of supply and prices, you know Did start to fall to the downside now if prices do start to come up? Beyond that then You know, it's this isn't really a pair that i'm interested in Although the australian dollar is you know, the weaker of the two I think there is scope for the australian dollar to start to appreciate the rba did end Um There are their qe program or they're ending it anyway I think february 10th is the is the day that they're going to end it and potentially looking to start to hike rates So pretty much what's what happened with the euro where they're trying to revalue the euro now against the dollar I think the australian dollar now may start to be Revalued so you could have a situation with prices pull back into this zone here In fact, that could be a very nice buy a very nice buy But it's not again, it's not a pair that i'm interested in Fundamentally because I do want to look for divergences. I don't think the convergence trade at the moment For me is strong enough for me to want to get involved in that And also as well gold so looking at gold strong what would say a strong dollar or stronger dollar puts a lid on On gold, but I do think again gold with if inflation starts to again run rampant Then you should see gold go to the upside If any kind of bad data for for the us for example with jobs or economic slowdown gold pretty much goes higher But at the moment gold is I mean the dollar is recovering gdp wise So it's probably suppressing gold for now and let's see what really happens But again, if you're in a bit of a tight spot with gold I would say again the the trades to really kind of look for is probably a deeper pull back into this demand zone around a 16 17 60 area or Up at the real kind of highs around that 18 60 18 70 area for any kind of shorts I think this area is decent as well the 18 50s for a short as well is is okay. I do like that technically But let's see what happens. But other than that If you're looking to buy the dollar then you know you to buy gold at the same time is buying the dollar is a bit counter-intuitive so I'd say pick a side and see which one You know prevails right for me a stronger dollar prevails I'm not saying a weaker dollar prevails would then ensue but it's gold is a much harder trade anyways That's it for this week. I hope you have a great trading week and take care speak to you all soon