 Hi, my name's Leon Roe, Currency Trader and Trading Coach at Trading180.com and welcome to this week's supply and demand for its technical analysis. If you are new to watching my videos, a warm welcome to you and if you're returning, welcome back and don't forget to like, subscribe and share if you find the content of use. And I just want to say thank you as well to all those who have been encouraging and leaving comments and positive comments in my videos as well. Really thank you and appreciate your comments. And if any of you guys would like to join Trading180 and join a great community of traders, I have a 50% discount which is going to expire on the 12th of January 2020 at 1159 London time PM. So if you want to join and really get really in depth analysis on supply and demand, this is not just your normal technical pattern, there's loads that goes behind supply and demand from stop hunting to capture pain relief to zero sum game to psychology to daily supply and demand zones, everything is encompassed in this course. It's literally easily over, I would say 50 hours of content including the weekly group calls and mentoring sessions and videos that I put in daily for the group. So again, this will be expiring very, very soon. So if you want to take it up, if not, that's fine too. I'll definitely see you at some point and keep watching my YouTube videos. So we'll get off and start on the trading economics, fundamental and sentiment analysis and looking at the week ahead, actually, in fact, before we get into the week ahead, just look at the week just gone. And really what's happened is global stocks much higher as US Iran tensions ease. So on Monday, well last week Monday and over the last weekend, you know, the risk of rhetoric regarding, you know, war, potential war, US civilians potentially being killed, Iran retaliating, troops being deployed has literally done a total 180 and you know, risk is less off, I guess, not saying that it's pretty much over, but Donald Trump has really kind of de-escalated the situation. So the stock market and a risk more risk on environment will march higher and it's actually made I think that was made new highs. So the US stocks Wall Street traders near record highs brush off weekday jobs data. So we had some weak jobs data regarding the US non-farm payrolls. So US jobs slow more than expected in December. But apparently it wasn't as bad as what was expected. So the hiring, the pace of hiring remained more than enough to keep the longest economic expansion in history on track while Friday's report also showed the jobless rate holding near 50 year low of 3.5% and average hourly earnings rising 0.1 in the previous month. So it's somebody has quoted I think Quincy Crosby chief market strategist at Prudential Financial in Newark, New Jersey said that this report is almost in line with consensus except the wage aspect. So if it's in line by the rumors are the facts. So even though the numbers came out as you know, quite negative, apparently the traders were looking at that as expected. So the headlines, you know, was, you know, December dampener, but overall I guess it was expected. Hence the reason why you probably didn't see, you know, that many will price really move in $1 for Friday. But let's go into this week. So busy week trade negotiations will be in the spotlight as Beijing sends a delegation to Washington for a free day visit to sign the so-called phase one deal with the US. So is there a trading opportunity with that? Absolutely. If you hear that the deal is not going to be on or talks break down, pretty much you're going to, you know, the chances are you probably want to look to sell the dollar. So but again, this isn't going to be something that will come out as a news event on something like Forex factory. It will be probably over the newswires. So it's best to probably keep an ear out for that. So because the expectation, the expectation is for them to sign a deal so if they don't sign a deal, then obviously risk off and I guess currencies like the Swiss franc and the Japanese yen will end up increasing in value as their safe haven currency. So meanwhile, key economic data to follow include the US inflation rate. That's going to be very important because that's important for the Federal Reserve monetary policy, whether they're going to be holding or cutting soon. Industrial output, retail, trade in Michigan, consumer sentiment, China, fourth quarter GDP. That's important for global economic growth. If China starts to slow down, it could be a global slowdown and trade balance and the UK monthly GDP, retail sales and inflation figures again, important for the UK. So let's get into the technicals and starting off as we always do on the US dollar index and dollar index. So from last week, pretty much we had prices rise from here, the dollar was really kind of shrugged off the war tensions and we did see dollar actually move high. I'm bullish dollar and I've been bullish dollar for a few years now. So this was a nice buying opportunity as far as looking for confluence. And then I was looking to buy the dollar against some other currencies, but looking at the dollar index, which is a measure of dollar strength against the main currencies like the euro, yen and the pound and even the Australian dollar. When you see something like this occur on there, that's when you want to go over to the dollar crosses and look for strength on the dollar into this week. We're pretty much into this range at the moment. So we've got the supply zone, demand zone. I think there will be due to probably some negative sentiment regarding jobs. You could see, obviously, prices start to fall and then that will obviously coincide with maybe some dollar weakness on any of the dollar crosses. But if you're looking to buy the dollar, then prices come down here and then you get some bullish price action in that demand zone right there. That's where we are looking to get long moving on to the dollar yen, dollar yen. So last week, again, I want it to be long here, but couldn't get long here simply because of risk off as the Japanese yen tends to strengthen the risk off environment, but the market shrugged off the risk off, the war sentiment. So you saw pretty much what happens. The yen has weakened and the dollar has strengthened. Now is there still an opportunity to get long, of course there is. And really the opportunity is from this area here, and this is what I would consider hidden demand, this outside, what is known as the outside capture pain candles, I call it, but an outside candle, outside day, whatever it is, it doesn't really matter. But this wick is what is known as hidden demand right here. So I'm interested in anywhere around the lows, the 108 round number to the 107-8, 107-7 number for any kind of long trades as long as risk is still on, that would be a nice, by the time we get down there anyway, if we do get down there, if risk is on, then that would be a nice buy. If risk starts to come off this week, this is going to be a very nice area to get short in. And there's a particular set up I'm looking for, if I was looking to get short on this and I've told traders in the group about this, and they know this, which is basically a bit of a stop hunt, this is a nice level, look for a stop hunt up top. And if talks break down between Donald Trump and the delegates from China, that's going to be a very nice area to look for some short trades within that supply zone as well, just above a nice little fresh area of supply up here. So very nice at the moment, you want to kind of maybe try to stay away from entering levels that have been touched several times. So this level and its price zone has been touched not only once, twice, you know, three times. Now I'm not really keen on that, but again, risk off, buy it again, risk on, you're looking for dollar strength moving on to the dollar Swiss dollar Swiss. What we have at the moment is bit of demand, I guess, here it's not necessarily typically strong demand at the moment in the way that I draw demand, but there is demand here. So plastic pretty much gone sideways. Let's see what happens. But if you do want to get involved long, then you're probably looking for a move really kind of back down to the lows of this kind of created demand zone around this 0.966 area or slightly lower, which would be the demand zone that was created from September 2018. If we can get some price action that comes down here and also if risk is on and the reason why risks should be on before you buy is because the Swiss franc is not, doesn't do well in a risk on environment or tends not to anyway. If not, again, if prices do kind of come down, et cetera, and that would be the definite nice area to buy the Swiss franc. If you're looking to buy the US dollar, I should say, if you're buying looking to buy the Swiss franc, you've got two options. If prices make their way up here, that's the first area to get short or if prices start to make new lows, new lower highs and lower lows, then you're looking for a pullback into those lower highs in order to get short. So you want prices to pull back into there and then look for some short trades. So again, make sure that risk is off before looking to buy the Swiss franc over the US dollar. Moving on to the CAD and CAD nice bounce from here. And this demand zone, fresh demand, fresher demand anyway, been touched once. So that's OK right here. Prices really kind of made this steep move down. So there was a nice opportunity to get long and lower time frames, you know, like the one hour, two hour, et cetera, nice, you know, potential entries around here and prices did make their way higher. The CAD did have some decent news, matter of fact. So regarding employment, so that was actually quite decent. Here's going to be the next demand zone. So what you probably want to do if you're looking to buy the US dollar is wait for a pullback into that area there. If you're looking for a sell trade, either you're going to have to wait for price to do something like this. Before into this number, if we're getting short or again, like the dollar Swiss, you're looking for a move down, move up, move down, and then a pullback into a supply zone, a newly created supply zone. So those are your options. New Zealand dollar, US dollar and and we've got decent price coming down to a decent demand zone. If you want to be a buyer of the New Zealand dollar, here we are. So we get a bit of a bounce here. The US dollar is really the number one currency at the moment. And on our fundamental analysis spreadsheet, the New Zealand dollar is number three. So it's kind of buying into a bit of strength at the moment. So I think this is a decent area for price to potentially turn around, especially because, you know, we've got some negative sentiment towards the dollar. So nice buying opportunity there. We do have some supply in the way. Doesn't mean a price can't break through them, but just be aware of it. If you are looking to sell the New Zealand dollar and buy the US dollar, personally, I'd rather wait for price. If price can get up to this point up here, that would be the better area that I would look for some sort of buying opportunity, because if price is potentially in a range between that high and that low, this is obviously seen as an expensive area, right? This is an expensive area for the New Zealand dollar, because there's no more demand for the New Zealand dollar. So if prices have started to come down, this is a proven expensive area. So or potentially a bargain area for the US dollar. So if prices come back up here, that's the best area to look for potential shorts for the US dollar. That's the way the supply and demand works. So either buy now or deeper into this demand zone, or if you're looking to buy the US dollar up into this, it's a 0.673 number and beyond, and then look for any kind of short rates. Pound dollar, pound dollar, I'm looking to get short on this. Mark Carney, there was some news that kind of slipped under the radar or it may not have for you, but I noticed it. And it was Mark Carney pretty much said that they may look to cut rates if the British economy isn't doing well. And again, Brexit on the horizon pretty much apparently supposed to leave at the end of the month. More uncertainty, why would the British pound get stronger? That's the question you have to ask yourself. Nothing to say, and obviously this is a game of probabilities, but what's the likelihood of the British pound weakening then strengthening? I think it's more likely that British pounds should weaken, especially economically. So I'm going to be short. So looking for short trades, I've got to wait for prices to really kind of come up to an area where I think I want to be a shorter or a buyer of the US dollar at a nice exchange rate. So let's see what happens. If not, I mean, if you want to be a buyer of the British pound, things could turn around, obviously. And the pound could get some really good positive sentiment when it comes to the economy. Then that's a decent area of demand to look for some buying. But I'll be looking for short trades if prices can kind of pull back, which would be nice as it goes this week or into the next week or two. If the dollar's got some negative sentiment, but then the British pound and Mark Carney decides to potentially cut rates. That would be very nice for a short trade. Euro dollar and Euro dollar. So we've got some demand zones, so supply zones right here, right there to there. Supply, we've got supply here. Now, again, I want to be short on this currency pair and buying the dollar. So I'm waiting for prices to come up to here before looking for any kind of entries or here, even better yet, if you can get fresh, maybe a fresher area of supply up here, prices can get that high and see what happens. But if you do want to get long on the euro, I would say probably now is the time or potentially if you're looking for a really good area, I would say this fresh area of demand right here. If prices can get down to this one point one oh six one point one oh five half number before looking at any kind of long trades. Again, you have to really kind of understand why you're buying the euro. Sorry. From a fundamental perspective, technical patterns, you know, if you're buying at demand and selling a supply, I think you're really not at the you haven't really got that much of an edge other than just a technical and statistical pattern. Really looking at, you know, the fundamentals as to why you really want to be a buyer. Why is this? Why is the euro a bargain down here? That's that's the question you have to ask yourself, well, why is the dollar a bargain at these areas? And really, that's derived from fundamental analysis and looking at things like GDP, inflation and interest rates. Moving on to the euro yen, euro yen. So again, more risk on sentiment coming to the market. Prices didn't really push lower. Now this demand obviously demands on and looked looks actually quite nice and prices have kind of moved to the upside. If there is some risk of sentiment that comes into the market, I think this area around here is going to be a decent for a short. Even bet would be really nice just above this level here. Zoom out a little bit. So, yeah, put somewhere around here for any kind of shorts for long trades, probably look for maybe something a bit deeper. Actually, as it as it goes, I think this level this level is all right. And there's a reason for that. And it's because pretty much there's a lot of traders that have been caught offside here and they've been caught offside by the risk of sentiment. So they would assume that prices were going lower. So if they're caught in their positions, i.e. they don't use stop losses, then these guys have to do to exit. They have to buy to exit. If they got short, then they have to do the opposite to exit. So that should add to the supply and demand equation at this area here. So actually, in fact, I don't mind that area to look for. If I was looking for long trades, to be fair, though, I'm not really looking to buy the euro any time soon against this currency pair, not the euro at the moment, even though actually I'm long on the euro against the Swiss franc, but that's for insiders and as to the reason why we are long on the euro Swiss franc. But anyways, Aussie dollar, Aussie dollar. So we're at a nice demand zone, fresh demand as well. The Australian dollar has been doing actually quite well. So if you were going to buy the Australian dollar, I wouldn't necessarily buy against the US dollar, but if the US dollar is going to get weaker due to some, you know, some negative sentiment about regarding the economy as far as jobs, then I think the Australian dollar is the best currency to, you know, to kind of short it against or go long against. So I think at the moment now is a decent time for a long trade, probably maybe on the dailies, probably gone a little bit. I was saying to traders in the Discord group that, you know, as far as news trading, you probably think prices were down here. I think some traders have got long around here. But yeah, let's see what happens anyway. I think from a daily perspective, you might have to just say if you've got enough to the upside, enough risk of war to the upside, then take it if not, then then you might have to wait for a bit of a pullback before getting long like that, something like that. Anyway, short trades are going to be from really from here. So that would be the first area I'd look for trading opportunity to get short, the prices can get up there. That's obviously very either expensive for the Australian dollar or a bargain for the US dollar. And I would wager that's probably more of a bargain for the US dollar. So let's see what happens with this decent long trade right there. And finally, the Aussie yen, the Aussie yen did break through this demand zone as that was, I think that was Monday. Yeah, that would that would have been the Monday, Tuesday, Wednesday, Thursday, Friday. Yeah, so there was a bit of selling off. But then again, the markets just literally reacted from this demand zone and gone a lot higher from there. Again, risk on sentiment coming into the market or less risk off as I like to kind of put it. And we have this wide zone of demand because we really kind of made new highs. Yeah. So when you've got a really wide zone like this, you've got a very, very wide zone. What you want to do is you want to break it down. Yeah. And so one of the techniques and things I use is to understand where there should be more demand or more supply at certain zones or certain levels and try and get a bit more intricate. So you can see around this area here, we've got resistance, resistance, bit of support, bit of resistance right around here. So it makes sense that if prices come down here from a technical analysis perspective, where do you think, where do you think traders are going to be looking to potentially get involved in the long trade? There. Same thing around, you know, probably somewhere like this where you've got bit of support and resistance in that area there. You've got to put a little micro level right here. When I say micro level, I'm talking about if you was to zoom down into the lower timeframe, let's say, for example, three hour, you can see where you've got support, support, support. So within these areas, you can start to see where you would want to potentially get long. Also, this is the 74 half number as well around here. It's just below the round number there, etc. So this is how we kind of break down these wide zones. And also as well, if you want to get a bit more accuracy, you may want to look for that area there. That area actually looks all right for a, within this area of demand. So you can see it on the daily timeframe. Yeah, you can see it's a general area where you've got resistance, resistance, support, resistance. But if you actually zoom in as well, you can see that there is a nice level where you've got that top of that wick, bottom of that wick, bottom of that wick. Yeah, and that represents itself just above that zone there. So that's a very nice price area where price may come back to. Yeah, come back to here. And this is where not only are we in a daily demand zone, we're also looking at where other traders are looking to potentially buy as well within this area. And if anyone's getting short up here, then where are they taking profit potentially going to be somewhere around here problematic areas. So if they're shorting here, they have to buy to exit new traders are potentially getting in here. If they're getting in and they're taking new long trades, what are they doing buying as well. So all the buying from a technical analysis perspective is demand. So this net net potentially we have a great location within this wider area of demand. Yeah, as to where we should potentially look for long trades, if we want to be a buyer of the Aussie Australian dollar over the Japanese yen from a selling perspective, the yen, I do like this zone here really do. If risk comes back off, and prices are up there, that is a very nice short trade, nice, a nice strong supply there, you can see the way price kind of feather way. So if prices come up to here, I think this should be a decent supplies and to look for some short trades if risk becomes off. So that's it for this week. Again, thank you for watching. Don't forget to like, subscribe, and share. The 50% discount really runs out on the 12th of January, 11.59 p.m. London time. So take advantage if you want to take advantage. And guys, I will see you soon. Have a great trading week and take care.