 Hi, my name is Leon Rowe currency trader and trading coach at trading 180.com and 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 and also equally warm welcome to you And if you find my content of use and you enjoy the content that I provide every week Please don't forget to like subscribe and share with your fellow colleagues So again, if you're new to the channel one of the things and really my approach to trading is to combine fundamental analysis and Technical analysis a lot of traders on YouTube will say it's one or the other Also, there's a lot of misconceptions about fundamental analysis. It's not going to look at something like Forex factory and trying to trade You know individual news events events. It's really about Understanding how to determine Currencies of value over the medium to long term and then looking at the technicals as a way to Technical strategy as a way to enter so combining the both gives us the best of both worlds and Keeps us on the right side of the market more often than not so Really again, like I said the trade process a bit of a detailed look quickly before we get into the technicals and fundamentals is understanding our Fundamental analysis spreadsheet which you can get access to if you go to trading 180 comm for less than a pound a day there's an option there and what we do is really Look for fundamental Convergences and divergence trades to establish price reversals or trend Continuation so I also have a video on fundamental convergence divergence And I put it a link to it in the top right-hand side of the screen Then once we've established our Fundamental bias then we use supply and demand zone CPR capture pain relief and stop hunt manipulation technical strategies to enter into Trades either long or short and again if you want to find out more Please go to trading 180.com or just look at the videos that I have hundreds of hours of video that I have on the YouTube So let's get into the The the fundamentals and technical analysis in this week. I'm gonna do something slightly different Going to go straight to the technicals and really kind of sprinkle over the the fundamentals on top for the major currencies like the dollar the the pound and the euro and as well as gold as well so Starting off on the dollar index and so the dollar index really is just a measure of dollar strength against basket of other currencies like the euro again the yen the the pound and the Australian dollar and Again deciding on what we want to do for fundamentals first usually is what we want to do And then we look to the technicals, but I'm doing it a bit backwards my backwards approach, but just to give you a bit of an idea depending on again your your fundamental bias you would be looking for the dollar index as Just some confluence for a dollar strength overall So if you think that the dollar is going to be a buy then what you're looking for is a dollar pullback For example to a demand zone in you know with the dollar index and then look for any kind of buy trades on any Other dollar crosses like the dollar yen dollar Swiss stock of CAD for example For me, I think the dollar is probably a bit of a short-term buy but medium to long-term Sell at certain areas just levels been touched several times so that more time the levels touch the weaker It becomes so I probably expect the dollar to kind of rise a bit higher if it can rise actually up to the 91 80 92 area. I think that is a brilliant area to look for some short-in confluence If you're looking for short-term buys, I guess any kind of pullback into Demand's owner of prices continue to go higher use that as as confluence for some dollar buyers and really the one of the reasons why is My Overall dollar bearishness in the medium to long term is that Janet Yellen faces currency war redux as strong dollar ditched Yeah, and I've been talking about this for since last year July August I'll say August from when they the Jackson Hole and the Federal Reserve employed the the federal average inflation target monetary policy where they are doing average inflation rather than just Usual target in their 2% and what that actually means and again, I've got videos on YouTube explaining this is that They really want a cheaper dollar the cheaper dollar and a weaker dollar Actually helps an economy. So don't be fooled when you see you know dollar crashing and all that kind of stuff a weaker Currency and a devalued currency actually boosts exports which helps G to grow GDP. So Dollar's depreciation has spurred others to intervene what that actually means is that other central banks who have a more expensive currency Are a disadvantage and makes them less competitive when it comes to, you know, growing their economy. Yeah, and this This paragraph really kind of spells it out, right? So for Yellen who is who this month set herself apart from previous Democratic administrations by Rejecting a return to a strong dollar policy that could pose a challenge, right? Why would a central banker reject returning to a strong dollar policy because they understand like I understand that Currency devaluation. Yeah currency war. All right, and what is a currency war? Put simply a currency war is also known as competitive Devaluations as a condition in international affairs where countries seek to gain a trade advantage Yeah, GDP trade advantage over other countries by causing exchange rate of their currency to fall in relation to other Currencies and that's pretty much what is going on. So other Currencies and other central bankers have to intervene. Yeah, I like the euro and we'll get to the euro fundamentals and technicals in a sec But this is the reason why I am more medium to long term bearish on the euro and on the dollar But probably more short-term bullish and for some some other reasons I'm pretty more short-term bullish on the dollar but only against certain other currencies which I'll get into but dollar index is Is a decent I think is a decent buy and then you know the next maybe week two weeks three weeks Who knows but there are opportunities to short I don't think this is really the opportunity to go short on the dollar right now again Not financial advice just basically telling you what what my view is I could be wrong I could be right, but when I'm right I make a lot more than when I'm wrong So it's not about win rates or trying to predict the future. It's just about seeing your analysis And if it plays out capitalizing the most you can so I think in the short term We probably may see Over-dollar, you know strength might pull back and I do something like that But I think overall dollar strength, but that just provides a shorting opportunity in the in the medium to long term So moving on to the dollar yen and the yen In a risk on environment doesn't tend to do well and you're seeing this pretty much play out, right? So I was saying this it's saying this for the past Maybe a few months risk on environment vaccine-led recovery global recovery you're gonna see You know the yen weakened and we've seen that Some of the guys in the group have had some really good trades Ensuring the yen and buying commodity currencies as of recent and even myself Took some profit on some pairs that I don't necessarily analyze here And from last year, so it's been some really nice trades Buying commodity currencies and shorting the Japanese yen But where we are right now, obviously you again you have to decide in which one you want to be a buyer of right? If you think that the the yen is a bargain at this supply zone Then you look for short trades here If you don't think so then and you want to be a buyer with a dollar You're gonna have to wait for higher highs higher lows or a pull back into a demand zone before getting long So that's pretty much where we are with with the with the yen dollar yen Moving on to the dollar Swiss and I think and I was saying this I wanted to get actually long on this currency Buying the the dollar versus the Swiss franc kind of missed out on a bit of a trade there Earlier this week, but I do honestly think that the the dollar should want to get stronger. I think for me The the Swiss franc is going to be one of the weakest currencies if risk continues to be on so The Swiss franc for me is deaf is a definite sell in a risk-on environment So if there's any kind of pullback into a zone that I like Then that will definitely be for me be I'll look for an opportunity to get long If you do, you know want to get short at any point then Really look for some risk off sentiment to come into the market first before looking at Getting short at any of these areas here a nice pull back to this zone here would be really really really nice for me I think currently if the risk is if risk remains on Moving to the dollar CAD the dollar CAD I think this market is probably going to end up ranging at some point. I think we've got another Some more supply there and some more supply in and around this area here, but um Dollar CAD I think overall my bias is to buy the CAD Maybe not against the dollar in in the short term, but I do think that We're a bit of maybe a bit of a ranging market So if you do want to get short anywhere around, you know, where we are in this supply zone right now Is decent if you want to be a buyer, then you're looking for maybe a bit of a deeper pullback before looking at getting long Not really interested in this pair as much I was calling this short from before the election and you can see pretty much what's happened since november What's what's really happened? But I think it's The the the CAD Strength has made might have run its course in the short term but again medium to long term I think a deeper pullback for me in a fresher area of Of supply I think around here would be really nice that 130 round number. I'd be looking for a potential short But again in the short term Not too sure in this pair or not too keen on this pair. There are better trades out there as they say um New Zealand dollar us dollar and again the new zealand dollar benefiting from risk on sentiment See we saw a nice, you know buy trade right here Um, this also turned into another demand zone Right here. So we made higher highs higher lows demand right there You can see where price came back down into it on thursday bounced off of that zone there and then, um Ended up, you know going higher I think overall though we are in the highs, you know, if you look at the looking at the overall trend and where prices have been I'm probably expecting a deeper pullback. I really want a deeper pullback before I look for any kind of Long trades. I do like this area here with the confluence of some horizontal Support I think that area there this 0.7 Uh, oh five level. I think is a really nice zone for any kind of Long trades also you've got some local levels here Which you saw in conjunction with some demand zones You can see where you had support resistance resistance resistance Some resistance support there and you can see where prices did bounce off there as well Um, I do think if prices start to go higher then that's you know, brilliant Then you're looking for a pullback into some sort of demand Um, preferably I would want prices to really kind of come down to really around here before looking at Looking for any major buyers at the moment. Um But again, if there's short term dollar strength potentially Then you probably might see this actually pulled back I think this actually might be a really nice zone for a short trade nice fresh area of supply I do like that. Um, if I was looking for any kind of short trades on this currency pair Um, looking now at the pound dollar and the pound dollar just keeps coming from strength to strength Higher and higher you can see pretty much what's going on and this is really More of a vaccine led move and the reason why if we go to some some some pound news The bond market is just is jettisoning UK negative rates bets ahead of the Bank of England and what that really means is that Money markets have priced out, you know pricing in so they're pricing out a chance of sub zero rates in 2021 and negative rates was Being speculated upon and the money markets the bond market, which is really the smartest guys They're when it when it comes to things like interest rates And really the economy and whatever the bond market says These guys are like I said the smartest guys because they really understand The impact of interest rates and inflation on the economy and so the bond market is pricing out a chance of Zero rates in 2021 and the vaccine led progress vaccine led progress brexit deal have tempered economic pessimism So there was a lot of pessimism around the pound and the uk including myself But it looks like the pound and the uk are leading the way when it comes to The vaccine rollout. So what that essentially means is that the more people they get vaccinated the quicker they can get back to work and the quicker The economy can reopen and start to grow again, right? So that's the bet you have to be two steps ahead one two steps ahead of what you're looking at now And this is really what is driving the pound is the future expectation of value There's no point in buying the pound after you see the good news, right? It's it's anticipating the the the the news, right of Of good news basically And understanding that we have to be ahead of the potential For the economy to start outgrowing other economies, right? So with that being said and also as well Just to back that up bank of england unlikely to cut rates below zero in the near term survey shows So only one in 14 economists expect adoption of sub zero rates officials to keep asset buying benchmark and change next week So again, that's you know, the fact that they're not as dovish on Sub zero rates cutting rates to the negative is actually bullish for the pound So with that being said any pullbacks You're probably looking at is here now from a technical analysis perspective. This is not a pretty char at all but there are Ways to You know To understand where in these wide demand zones that we should be possibly looking at and one of the things we look at Is horizontal support and resistance? Because that adds to the supply and demand equation at levels, right? We know that there's demand here because prices are going higher making higher highs, right? But also from a technical analysis perspective We understand where the financial institutions are looking at because they've been looking at those areas in the past So support and resistance. So within that larger demand zone I think that one three five round number is definitely a zone of interest and it's been watched In the past So you can get a bit more detail if you do want to go down into like the hourly the four hourly, etc And start to look for, you know, more intricate trades as far as buy trades if you want but For this video, we just look towards the daily Zones as those would be the strongest areas of And areas where we want to be buyers potentially From a sell trade perspective. It's really nothing the last So kind of supply zone was really all the way back up here. I would be interested possibly in this Supply zone or this area. I wouldn't say in this area is a supply zone, but Not from 2018, but it's a high Right, it's definitely a higher to look towards. There is supply here But as I always say what drove prices down here Yeah Two years ago is not always going to be the same Fundamentals that's going to drive prices down here So the best thing to do is if prices continue to make their way up And then they react here and then there's some sort of fundamental or risk sentiment change Then that would be where you would look for any kind of supply But we wanted to react there first and then look towards the fundamentals or fundamentals first And then look towards the technicals really. That's what you should be doing Um So in the again in the short to medium term. Oh, I say definitely medium term I'm probably a bit more bullish on the pounders and then as long as the the data supports that so gdp starts to grow for example And the vaccine-led recovery is actually having an effect on the economy Then that will drive, you know bullishness for the pound So nothing from a technical analysis from a self perspective And less prices kind of prove that there is supply here I mean if there is prices do, you know start coming down Then you can start drawing a supply zone there and then look for any kind of short trades If you're really that bullish on the dollar Moving on to the euro dollar and the euro dollar I'm actually short term Bearish on this. I do think that the dollar Depending on what comes out this week because we do have some Some analysis coming out as far as news and the week ahead I think the euro Is probably on a bit on a bit on the back foot And I think there may be an opportunity to actually short down to this 1.195 area this this demand zone So Let's see what happens. But with the euro going into some euro analysis ECB officials a greater counter Investor rate cut skepticism. So the guard emphasized All ECB tools are viable if needed and the market pricing suggests rate cut through march 2022 is unlikely that is a problem with the europe with europe. Yeah, is that Europe and the euro is actually quite expensive Which is not good for the economy because it makes them less competitive as i've Previously pointed out, you know with the currency war So european central bank policy makers are uncomfortable that investors appear to be largely ruling out Interest rate cuts and have agreed and and have agreed to stress that such stimulus remains a viable option and what that really means is that The The investors are saying well, we don't believe you that way that they're going to make an interest rate cut Right, they're not and so if they're not going to make interest rate cuts Which basically means that they're trying to devalue their currency Then what will investors do? They're going to start buying right the same thing that will have that I explained with the with the pound They're looking to buy the pound and the reason why they're going to buy the pound is because Bond investors are saying well, we don't believe that the bank of england are going to be you know Cutting rates into the negative. So it's really, you know quite Uh hawkish for the pound. I should say so With europe they have a bit of a conundrum because they have an expensive euro Which is a problem because an expensive currency doesn't help when it comes to GDP and making um, you know Their economy quite competitive when it comes to exports. So, um So they don't believe the uh, the european central bank So they're probably looking to and until the european central bank really start to ramp up the rhetoric And really kind of threaten that you know that they are and they will do something about it Um, you know the uh investors aren't necessarily looking for um a weaker euro But I do think that forces the the ecb into Potentially taking more of a you know stance when it comes to having to weaken their currency because I have to do it anyway regardless whether the um investors are sceptic Skeptical or not so going back to the fundamentals I think in the in the in the short term you may get obviously a pullback but any pullbacks for me right are I think short term Um, uh sells euro dollar So I do think that the the um the dollar is actually in the us is actually winning the war the currency war The higher this goes the more uncomfortable this gets for europe um, and uh So they have to really start to do something so if we do see prices start to come up and come up That's putting pressure on the ecb and then you want to look for potential short trades in and around here Nobody knows Well exactly it's going to turn that's the reason why we just manage our risk if we lose one trade is fine Because if we're right on this we've got multiples of r we can go for 10 15 20 to you know one type trades if we're right about You know the our fundamental direction So that's where we are with the euro against the dollar um looking at the euro yen euro yen coming up to a uh Uh supply zone. This was a really nice trade earlier. Um, uh last week and last couple of weeks ago I made a video on this on the youtube channel a nice cpr zone Really really nice zone here and you can see pretty much what's happened. It's gone for a really A nice couple of hundred pips so um and really the again That's I was saying the yen is a really a sell and a risk Uh on environment the euro is definitely going to be the one that was going to be the stronger out of two Um, so that was a nice trade there demands that is demand is really higher highs higher lows We've come to a nice area of supply but again, it depends on whether you think The year the yen is worth You know buying here is the yen a bargain? That's the question you have to ask yourself right Is the yen a bargain and what makes it a bargain? Just because prices come up to a level of supply doesn't mean that you know prices are going to reverse You need to understand why from a fundamental and risk sentiment perspective Why the yen is likely to be a bargain why the euro is likely expensive up here and uh, you know Why uh prices are likely to um, you know fall from here from a fundamental and risk sentiment perspective So for example, if risk sentiment starts to come back off Yeah The yen should be the one to buy Yeah, that should be the one to buy and then you would say all right and that's the reason why but if risk continues to be on Yeah, then why are you getting short here? It makes absolutely no sense But um, again, if you want to find out more about how I go about analyzing levels not just from a technical analysis perspective But from a fundamental perspective You know, you can check out trading 180.com Um, continuing I think for me any kind of pull backs into this area, especially this lower zone here I do like this zone This one two five 50 now. I think that's a really nice level for a potential buy Against the the yen as long as risk remains on if prices do come down here I think that's really nice for a long trade even better would be, you know pullback down here um So that's where we are with the euro yen and Aussie dollar Aussie dollar continues to kind of remain um, you know again No real major pullbacks for me for me. I think um, I think probably Anywhere around within this zone, I think possibly if I'm looking at this area here Probably might look for that zone around here for any kind of buy trades Again, the australian dollar doing really well and the risk on the environment So prices can come down to the 75 round number matter of fact So I'll just project that down a little bit more. So that's 75 round number I think that's that's a really nice area to look for any kind of long trades within that demand zone And again, there's I think there's some minor levels within there as well I think there's some support and resistance horizontal support and resistance right there So you've got resistance resistance. So that also that 75 70 level could be a decent area for a buy trade as well If you want to be long the australian dollar I think it's due definitely to a pullback. We've had that massive run and really no major pullbacks So I'm probably looking for some sort of pullback into the 75 round number Even better would be 74. I think that's a nice area because you've got some nice confluence of Daily support and resistance within that demand zone there. So that would be even nicer for a really nice Trade to the to the upside, but how it's going to get there. Who knows? Um, and again, if you see some short-term dollar US dollar strength that would you know be quite nice um Where are we? I think I'm going to delete that demand zone as we've touched this demand zone here And I'm going to extend this supply zone down to around here. Yeah, so that looks much better And again any kind of um pullbacks if you want to be a buyer of the US dollar Up here not the best area to look for supply though because Just the way that it's uh, it's moved away from that you want to see really kind of hard in hard out movement But this is kind of done it really um slowly and choppy wise So not the greatest former supply zone perspective And they're moving on to the Aussie Uh yen And again Aussie yen going into more of a ranging market We've seen prices have really kind of been contained between You know this high and this low at the moment over the past You know since pretty the beginning of the year and I think this is maybe due a bit of a pullback If it can pull back to this zone here I think that demand zone started at maybe the uh 78 50 50s down to 77 50 is a really nice zone for a uh long trade Um for now though supply you're probably looking at something around here So potential for a nice short trade if you want to be a buyer of the Japanese yen But again, why would you want to be a buyer of the yen in the risk on environment? So even though prices may come down is at the smartest move Why not just wait for prices to pull back and then look for some long trades um, and then finally we have uh gold So gold uh this week Um with some dollar strength. I think dollar strength Uh, we could see we could see a bit of a pullback on on gold You know, I do like this area this 1800 area has a nice potential buy even better for here Yeah, down down here. This might is my bias to 1786 to 1764 area I think that's a really nice buy Um, uh for various reasons the guys that are in the group will know this as a capture pain relief zone Right here. So for me on the lower time frame that entry is going to be really nice If the water again, it depends on you know, if we even get an entry because uh, that's what we need is the final thing But once prices come down to this 1810 area I think it's quite nice for a potential buy and it might be that level might even might be manipulated when we look for a stop hunt trade, but um Below that I think is really nice as well a nice fresh area of of demand and gold has um Has uh You know, the demand has kind of been off the the boil but demand for gold jewelry fell to lowest record in 2020 Again, that's unsurprising because if you consider um, the fact that we were in lockdown and uh, Who was really buying jewelry and for what right? Um Who's got jobs? No, I mean, there's a high unemployment people being laid off. The last thing they're looking to do is is buy gold looking to survive really so You know with the chinese economic recovery though is supporting a rebound in demands So global gold demand is set to recover this year after slumping to the lowest in more than a decade in 2020 According to the world gold council. So um just goes into some statistics about you know decade low gold demand Again jewelry sales um But if that jewelry sales start to pick up as well as things like inflation anyways, so you gotta think about um, you know central bank printing inflation is coming in inflation is just Basically currency valuation or devaluation. So in a pandemic era central banking is creating bubbles everywhere cheap money Provided by central banks has been inflating assets and reshaping how we save invest and spend and Interesting article from bloomberg, but if you look at you know governments and loading up on debts the central bank balance sheets Look at what's been happening Massive massive, you know near parabolic moves. Look at the federal reserve. Look at that adding, you know to to their debt and it's uh, it's crazy the amount of um debt that's been uh, mine is being printed um to basically save the global economy, but that should Devalue currencies and it would be net net positive for Gold anyways, so in the short term nobody knows it's very very difficult to kind of predict what price is going to do In the short term. Yeah day to day week to week, but month to month. Yeah Year to year you can you know, six months three months quarterly. Um, you can you pretty much know Um, or have a have a higher probability of understanding where gold is going to go because of the amount of money printing inflation, etc that is going on in the In with the financial systems, so uh, Goldman Sachs, I think um, I still no, sorry city group Is still predicting I think by the end of the year 2100, uh gold to that city City group Yeah, I still uh doing that and in fact, I'll show you a quick uh quote from a city group city bank, um PDF that we use in the group So gold news this is from city bank. Um, you know, gold news the market reacted positively to the inauguration It goes with the gold news gold outlook We expect gold market bull cycle to slow but not end so long as the feds monetary policy stays accommodative At the zero bound level commits to dovish for guidance and continuing with its qe program Remember what I was saying about the dollar medium to long term. Yellen is not committed to an expensive dollar She wants a weak dollar overall. Yeah, so we look for gold prices to move towards the 2100 dollar an ounce over the next six to nine months before moderating in 2022 Overall gold prices should average around that in 2021 average that so averaged all 1900 so, um, you know, basically, uh understanding where the long term forecasts are sick, maybe the The naught to three zero to three month forecast eight around 1850 But the six to 12 month forecast is higher. So any really any any pullbacks if you think about where we are now We're 1847 which is basically around the average. So anything below that. Yeah It looks like an absolutely bargain doesn't it? So that's where the money is made Yeah, is is buying for cheap and this was obviously a bargain back in 30th of november And prices went higher the bargain hunters You know proved that there's a bargain here So if prices ever do come back to around this 1780 level, is that going to be a bargain again? And again, that's what we do as uh, it's not only supplying demand traders But we do that as fundamental and risk sentiment analysis traders You need to add this string to your bow to understand what's going on in the market How can you call yourself? You know a gold trader or a forex trader a true forex trader if you don't even understand Interest rates inflation And and GDP and the relationship between it. Yeah, you trade you might trade forex But if you don't understand that you're going to get laughed at a room really you can't take You know, you can't really enter into certain conversations with serious traders. Anyways guys, um, that's it for now I hope you enjoyed this week again. Don't forget to like subscribe and share. Let me know on a new format If you prefer this way or I can go back to the old way of just doing the fundamentals first and then doing the technicals But I think, you know integrating both at the same time gives it a nice little mix anyways guys Have a great trading week. Don't forget to check out a lot of the videos on my youtube channel and also as well The private mentoring and private group is closing within the next couple of days So head over to trading 180.com Within if you after you watch this video, it might be too late. But if you do And you know if you want some mentoring if you want to understand really the fundamentals behind Currencies as well as gold silver bonds, etc Then head over and you can access that for literally less than 99 pence per day Anyways guys, take care and I'll speak to you all soon