 Hi, my name is Leon Rowe, currency trader and trading coach at Trading180.com and welcome to this week's supply and demand Forex and Gold Fundamental and Technical Analysis. If you are new, welcome to you and if you are returning an equally warm welcome to you and please don't forget to like, subscribe and share this video and many of my other videos on the Trading180 channel with your fellow trading colleagues and at Trading180 we use a combination of fundamental risk sentiment and technical analysis, supply and demand strategies to make really the best trading decisions. And so let's get into the week ahead and starting off on TradingEconomics.com and the calendar. I see it's not really the calendar, it's really the week ahead section on Trading Economics. So after a turbulent half of the year, investors will look to continue for signs of a potential recession as interest rates around the globe increase so the US Jobs Report and FOMC Minutes will take centre stage next week but comments from ECB President Lagarde and the RBA Interest Rate Decision and China Services, PMI and inflation will also be keenly watched. So definitely those are the main highlights for the week and of course if you go to TradingEconomics.com and look at the week ahead tab you can just read the rest for yourself which gets into the need. So let's get into some of the charts and some fundamental analysis, some more fundamentals and starting off on the dollar index and the dollar index, just a measure of dollar strength against major currencies like the euro, the pound and the yen and what we've seen really with the dollar index and I don't necessarily trade the dollar index but I keep an eye on it and understanding over what's like I said dollar strength is a lot of traders think that the price of the dollar should come down and I do think that at some point we will start to look to probably enter into what is known as a range but should be known as an auction where prices are trading kind of sideways between an agreed value between what is really expensive and what is potentially a bargain and I do think that it's likely to stay between the 101s and the 105s or the lower end of the 106 is just below that. Of course can't be 100% not necessarily 100% this is what is going to happen but there are reasons for the dollar looking to potentially trail off and one of them is recession talk. Now this is the IMF is saying that the US will narrowly avoid a recession in 2022 and 2023 so the US economy's path to skirt recession is narrowing MD says and Fed's plan to get rates to 3.5 to 4% is correct policy so getting into the first couple of paragraphs the US economy is likely to slow in 2022 and 2023 but will narrowly avoid recession as the federal reserve implements its rate tightening plan to curb inflation the international monetary fund said and the policy priority now must be to expeditiously slow wage and price growth without precipitating a recession the IMF said in a statement on Friday this would be a tricky task as global supply constraints and domestic labor shortages are likely to persist and the war in Ukraine creates additional uncertainty so there are you know some some risks involved in this and my opinion is that pretty much all major economies you know what we talk about you know the G10 and the G10 are probably going to enter into some sort of I think close recession or into a recession but I think the US potentially is best placed but as we get closer to the end of the year I think and into next year I think the dollar you know may start to tail off as far as strength wise if we look at you know from a technical analysis perspective of course technicals lag fundamentals and you know we've seen the dollar strengthen this has really been due to monetary policy and the dollar being the best of a bad bunch right um so I do think that uh the dollar is still a buy to be fair in in the short term so any pullbacks to any kind of demand zones I think are still biased where my bias is um I don't think it's necessarily gonna you know reverse and start to you know crash like a lot of people think it is um but of course I could be wrong have to wait for you know the data to kind of prove that but for me I still think that a pullback into um any kind of demand zones but I think that upside is limited not saying it's limited to the 105s but um I think that's probably where we are now unless there is some really kind of outstanding news um and economic data for the uh for the US economy but for now I think we're probably seeing you know upside potential or um coming in to play right now but any pullbacks I think any dollar pullbacks are I think are still buying opportunities until proven otherwise uh moving on to the dollar yen and the dollar yen you know is pulling back to a demand zone which is technically right here now um you've obviously seen this these two blue moving averages and that's the monthly moving fair value is known as moving averages um 21 period because there's 21 days um uh in a month I mean a trading month anyway and um one of the things that I look for is its value right and uh we need to know how to measure fair value as well um because you don't really want to buy expensive areas you want to buy the minimum you want to buy is a fair value right so understanding what an average is an average is a mean a mean um between um you know a high and a low point high being expensive and a low being potential bargain right is also can be considered there's supposed to be a b fair value right that's fair value so um fair value can be measured in many different ways but taking the price over the last uh you know month um we're still above the fair value area so for me personally I you know I personally don't like to trade um above areas of fair value which may may be expensive and so I have a bit of a rule which says anything above uh fair value I'm not trading because again if you're looking at where we come from here to all the up at the highest um uh that being that absolute bargain and that being an expensive area because probably because there's no more demand at the moment above that zone um I want to wait for pullbacks a decent pullback so at least a fair value into the lower end of this so in the 134s before looking for a trade and of course um you know looking at uh you know the the intraday going down into the you know potential one hour 30 minute and that would you know line up nicely with that zone here personally though I do like the 132s, 133s, 131 50s would be an even better buyer so anything beyond that monthly fair value would be considered a potential uh bargain price um so again my bias is to the upside the yen um that is um a a currency that generally does typically strengthen in a risk-off environment but the market at the moment I think is being more driven or has been more driven lately towards um you know a monetary policy rather than divergences in monetary policy rather than risk sentiment although there are again risk issues global recession potential but I still think that the dollar does um well again in a risk-off environment so I think personally the earliest place to kind of look for any kind of trades would be at the 134 to 6 but I would prefer anything below the uh um uh this demand zone especially if it comes down to the 13149 area if it comes anywhere around there I think that's going to be a decent uh buying opportunity but if you want to also get short there is a supply zone not the strongest supply zone at the moment but there is something sitting right on top of that demand zone um so if you do if you are waiting for some sort of pullback into that zone before getting short there's a there's a say it's okay it's all right for us for a sell but you'd have to really understand why you're looking to buy the Japanese yen the only reason why I would be buying the Japanese yen is if the uh the bank of Japan um start to indicate that they are intervening in the market which um I'm not really going to explain in in this video I guess I might do it during the week or release a video as to why um uh you know the the central bank intervention as far as the bank of Japan intervening may want to cause the uh the yen to uh to strengthen or why they don't want it to weaken you know maybe anywhere above the the actual 140s right which we're slowly approaching uh moving on to the canadian dollar sorry the dollar swiss franc and the swiss franc has obviously been strengthening um recently because of the surprise rate hike um I do think I do think that there are um you know selling opportunities technically not really a pair I'm interested in but if you do want to be a buyer a buyer of the swiss franc against the dollar then I think the upper end of this area is going to be quite nice for a uh sell but uh if you do want to be a buyer prices did come down into this demand zone uh and bounce off uh uh during the week on what was that Wednesday so there was a decent buying opportunity but for me fundamentally I'm not really prepared to uh to look for buying opportunities on two I would say one strong currency and one recently um you know strong currency or turning strong anyway due to um monetary policy especially the uh surprise so the market is pricing in what the swiss franc should be valued at in next maybe three to six months and it could be a bit lower but let's see but not really a pair that I'm I'm interested in the dollar cad and dollar cad prices came down last week into this demand zone kind of spiked through and then you know there was an opportunity for a potential buy um again two currencies where central banks are looking to high crates um again not really a pair I'm looking for I tend to look for uh either divergences in policy right where currency is getting stronger and number one is getting weaker based on monetary policy divergence or some sort of convergence right um where a devalued currency is looking to revalue and whereas a currency that was appreciating uh is actually has to that's kind of devalued so um you know with that being said I think the uh dollar cad for me again not really something I'm interested in right now although I do think that um that may change if the risk on if risk going the environment does come into play I think the Canadian dollar will strengthen and I think the uh this will be a a sell trade so I'm not really a buyer of the um of the dollar US dollar against the Canadian dollar but if risk starts to come back on um then I will be a potential buyer of the Canadian dollar um and I'll decide whether it would or whether I want to be a against the uh um the US dollar because there are weaker pairs out there to be fair um but again decent trading areas I think I'll just pull that down to around here not the strongest area of demand to be fair but if prices do come back down um into this and then you get like some sort of intraday entry then that could be decent for a potential upside and all you do is you zoom down into you know a lower time frame and look for any kind of a buying opportunity around here New Zealand dollar US dollar on the daily um again we haven't quite broken through that demand zone um we can readjust this though I think probably something like that and then we've also got um supply zone here now again commodity currencies don't do well in a risk of environment the US dollar I was saying this last week the path for these resistances to the downside um for the for this currency pair because because commodity currencies tend to suffer um the US dollar obviously uh benefiting the risk of environment and you've seen what's you know happened um pullbacks I guess if you want to be a buyer with the New Zealand dollar they are hiking um they're in their hiking cycles so the downside should be probably limited but I don't really like this again I don't really like this pair too much again I'll probably say the bias for now in a risk of environment should really be to the to the short side so any uh short trades you know at the 163 probably the 164 164 0 64 um cent number I think is probably going to be the better area to look for any kind of short trades plus as well it's it would be above the monthly fair moving fair value um the pound dollar this is something that I am definitely interested in and again um saying that was waiting really for a bit of a pullback to come into the market but just didn't get one but doesn't matter anyway because there will be there's always pullbacks and if prices do pull back to this area the one two three fifties one two fours I think that is going to be a very nice area for a potential short trade um there's been a talk about the uh the medium to long term you know the 118s so if we can get it all looking weak in a bit you know what I mean and uh we can get a bit of a pullback into that you know one two two sixties to one two fours I think there's going to be um definitely an opportunity for um for a potential sell trade as I'm still um you know bearish on the pound um looking at the pound uh fundamental soaring inflation to hit Britain harder than any other major economy bank of england warns right so um the soaring inflation will hit Britain harder than any other major bank of england I'm sorry any or a major economy during the current energy crisis uh the governor of the bank of england has warned Andrew Bailey Bailey said the UK's economy would likely weaken earlier and be more intense than others as a result of the energy price shock that all european economies face the situation was further exacerbated by in in Britain by the structural legacy left by covid in the labour market as companies struggled with a lack of workers so if that doesn't tell you everything you need to know about you know going short on the pound not financial advice of course um and I don't know where you're going short but I've got my trade setups um you know beyond this uh just this uh this video um in the private members group which I share with those guys and setups that we that we use um from stop hunts to capture paying relief uh as well as obviously daily supply and demand again my bias is still to the short side so uh let's see what happens with the pound dollar any pullbacks for me are shorting opportunities um euro dollar similar bias actually let's say similar but the same bias um we have um you know for me getting uh short and I did get short uh this week it was a nice stop hunt a few people got involved right at the highest got a pinpoint entry um and took prior took profits anyway around the one oh four I think it must be maybe the one one oh four four yeah somewhere around here anyway um so it was a nice um uh maybe about 150 170 pit move um uh in in the group a lot of traders uh caught that as well and again we have the monthly uh moving fair value acting as resistance there um so we knew it was basically a at least fair value for where we wanted to get involved in this trade now um Europe right are in the spotlight this week and uh Europe's ECB's High Wire Act to deliver rate lift off enters final stretch so officials meet in full um last full week before pre-decision blackout and size of rate moves designed uh design of crisis tool may be in play so now officials have seen June's record inflation reading judged to be pivotal for their next monetary move they'll convene Wednesday for the final scheduled opportunity to prepare for two day for their two-day meeting starting July the 20th and with all major eurozone data out in the open and key gatherings including an annual retreat out of the way policymakers can focus on haggling over the size of rate hikes and the design of an anti-crisis measure yes so it's basically an anti-fragmentation tool so the you know European Union is suffering from what's known as fragmentation so they might be hiking rates but the effect of the hike may be uneven across you know 19 european countries so which may cause fragmentation you know with the economies as some economies can you know maybe cope with interest rate hikes and others can't right so let's see what happens there um as well as you know problems uh jp morgan c stratospheric $380 oil on worst case russian cut yeah crazy um so a global um global oil prices could be stratospheric $380 a barrel if you were if u.s and european penalties prompt russia to inflict retaliatory retaliatory crude output cuts jp morgan chase and co analysts warn and um we also can see if it comes up here we go germany risks imminent recession on gas cut off deuterbank says so um you got jp morgan enjoyed deuterbank um you know worried about obviously oil and gas and energy and europe faces big negative supply shock on russian gas and analysts warn energy turmoil to hurt growth and weaken the euro right so there's the direct correlation so european economies are facing a major new shock from slowing deliveries of russian natural gas which threaten to push inflation even higher than the current record levels and drive the continent's powerhouse germany into imminent recession deuterbank said so with all that being said again you know it's it's currency trading especially at the moment is all about you know dog with the least of these who's the best of the worst and um at the moment as much as you know the focus might be on the u.s dollar recession i think the european are much worse positioned so any pullbacks um to any kind of supply zones uh for me are uh are shorting opportunities uh even better still i think the 107s even though um the european central bank might be hiking rates uh they are hiking into uh a lot of weakness at the moment and there's again there's even talk of potential parity um you know one to one uh euro dollar uh rate which is probably at the moment around 400 uh pips um you know to the downside or 300 yeah this is about 400 pips to the downside so i think if um if there's a there is a pullback i do think i'm i want to be a shorter again and this time i'm going to end up holding the trade and seeing how far it can run um ozzie dollar ozzie dollar again commodity currencies suffering in a risk-off environment the u.s dollar being you know the stronger out of the two although i am a buyer of the australian dollar and i am in the i'm in the dollar um ozzie uh yen um trade which has uh actually been profitable on the friday but um what we see against the dollar um is should i i'll get rid of this uh demand zone and it's more we're seeing uh really kind of supply come in at these areas and um if you are looking for a potential buyer and buying australian dollar you'd have to i think you'd have to really kind of see um uh risk gone start to take place i do think downside is uh limited due to a potential larger um rba rate hike so we could see some downside potential uh limited and this could actually just be a decent buying opportunity based off of that alone so let's see um but for now i think again the path of leaf resistance probably to the downside um and any basically trades that come up up above that 10 sorry that 70 cent area above the the fair value the moving monthly moving fair value is going to be a decent buying opportunity for the dollar if you want to be a buyer of the dollar uh against the australian dollar um but again any kind of setups for a buy um from a supply and demand perspective i don't think there's really a let me zoom out a bit now i don't think there's unless you're taking unless you're taking a the potential demand zone from way back in 2020 then um now i think you'd have to wait for proof of value to wait for price to really kind of prove that there is uh you know strong demand first and then wait for a pullback into that zone before looking at getting long and that's really the way to to kind of play it um and moving on to the ozzy yen and um yeah so managed to get involved in a nice stop hunt around this 91 50s 60 70s area which is actually paid off quite nicely but that's beyond the uh i guess the um the scope of this video as i talk about supplying daily supply and demand zones but um i'm going to keep the zone here matter of fact keep that zone there uh demand and um from a buying opportunity you can look towards the lower time frames and look for any kind of buying opportunities um if you believe that the australian dollar is is is a bargain here it was obviously a bargain at that point in time so potentially we could start to see prices move to the upside um if not and prices move further down then i think this 90 uh cent area is going to be quite nice um or 90 dollar area is going to be quite nice um as a as a buying opportunity especially around the 89 88 87 30s i think that's very nice for a potential buyer but let's see what happens in a risk off environment you would expect the um the uh the the the yen to do well but i think um at the moment with uh potential rate hikes coming i think there should be some at least a potential upside first before we start to see any moves down or it could be other way around right we could see some moves down before we see you know a move up so but either way our bias is to buy the australian dollar um and continue to buy australian dollar for now um and we also have finally gold and gold nice buying opportunity here on that daily time frame chart um i did say last week that prices have come down to this 1784 that's a nice buying opportunity um strangely enough gold has been um not doing so well in the risk off environment um there's there's many reasons for that or potential reasons for that but um central banks are buying gold so um if you believe that the there's recessions all around um gold it should be something that you should be buying it should be something in all portfolios really is a hedge so um for me gold is a buy and uh i do think potentially this could still come down but with with the dollar looking to um the us dollar anyway uh if that starts to um weaken a bit and pull back then you can you probably could see a dollar start to so a gold start to uh strengthen so let's see what happens there a lot of you know recession talk fear uh should want to drive gold to the upside so any you know from now anyway i think a buying opportunity anything lower than this is starting to definitely turn into you know definitely bargain opportunities i think smart money is definitely getting involved down there as well um anyways guys i think that's pretty much it for this week and um yeah take care and i hope you have a great trading week and speak to you all soon