 Hi, my name is Leon Roe currency trader and trading coach at trading 180 calm and welcome to this week's Supply and demand forex and gold fundamental and technical analysis If you're new a warm welcome to you and if you are returning an equally warm welcome to you And don't forget to like subscribe and share as it's a free way of supporting the channel and really gets the YouTube Algorithm to promote this these videos and my videos and get the quality content out there, so Let's get into really the analysis and Starting off first of all as we always do on the week ahead So looking at the upcoming Fundamental macroeconomic drivers So G7 finance ministers reached a historic agreement on Saturday to reform the global tax system ahead of the highly anticipated leader summit on June 11th, June 11th to the 13th, sorry of 2021 Not too sure what that's gonna have on what impact that's gonna have on the on forex currencies But what we do know is that monetary policy meetings in the eurozone Canada and Russia will be keenly watched and that should have obviously Depending on what the ECB in the Bank of Canada Talk about that should have any an effect on those currencies as well as updated GDP figures for Japan The eurozone the UK and South Africa so GDP is also another important metric to keep your eye on other important releases Include US and China inflation inflation is definitely another metric especially in the US as as inflation is really key to To where the Federal Reserve or Drivers of where the Federal Reserve may want to take either tapering or interest rate hikes or holding and foreign trade data US and Australia consumer sentiment Germany and India industrial output in Japan covering accounts so quite a busy Week this week coming up From a fundamental perspective, so let's get into really the the the technicals and looking at the dollar index and the dollar index is just a measure of dollar strength against the basket of currencies like the pound the yen in the euro and the dollar has actually been on a bit of a weaker over the past maybe month or two it's been on a bit of a decline and This is actually Pushing in inflation actually higher a weaker currency as you can see actually pushes inflation higher and Over the past a few weeks or so. We've pretty much just seen prices really kind of remain in this range Kind of like a holding pattern Maybe an accumulation pattern, but from a fundamental perspective. We did have on Friday Supply strains hold back the US jobs market so the US jobs market is a is a key indicator as to Decisions or for the Fed to make decisions as to where they're going to go with monetary policy, so US jobs growth disappoint again in May because I think in April There was a massive miss with non farms and again It wasn't necessarily a fantastic number. It's below expectations But but this is not a demand issue a host of reasons to keep in a supply of workers constrained Which means firms are having to pay up if they want to recruit staff Sotensions will eventually ease but in the near term it heightens risk of more elevated inflation readings, so Again some of the what the experts say And to some commentary on this so adding over half million new jobs would be amazing in a normal month Says Paul Ashworth of capital economics, but they but these are not normal times and job creation is slower then hoped so I think the the issue really is not necessarily the The the fact there's no jobs. It's actually getting workers back into jobs into actual employment and And so again, this is driving monetary policy so fed to be deliberately patient on asset taper Mester says and Basically tapering is basically supporting the economy the central bank the Federal Reserve Bond buying at the moment and really support in the economy what they want the economy to be yourself sufficient rather than depending on the Fed really kind of You know support in the economy through bond buying and debt buying so so I would say tapering Should be positive for the currency, but the but the Federal Reserve really can't remove tapering if Employment for example isn't or unemployment isn't getting Lower and employment going higher, right? Because the employment is directly correlated to GDP and the economy so the Fed are pretty much very very patient or deliberately patient on on removing support and stimulus, right so The dollar in a bit of a difficult situation and even Wall Street pros are as baffled as anyone by the dollars fates of Goldman Seas 2002-2007 deja vu of deficit driven weakness And rising exports shouldn't fuel currency drop Morgan Stanley. So there's some conflicting information when it comes to Understanding from from Wall Street's the smartest guys in the room whether they think the dollar should be going higher or lower Right, so wondering where the dollars headed in the U.m. As the US deficit keeps growing Wall Street is also trying to figure that out as well because the more the Fed are you know printing money and support in the economy The bigger the deficit, right? So going back to the dollar the dollar at the moment when there are Generally When it's been the path isn't clear as to where prices should go higher or lower what tends to happen is you get what's known as a range Right, this is where traders are in agreement between You know an expensive or a bargain area. So for now, I think we probably will remain in this Ranging market probably some negative sentiment coming in due to jobs. So we are at the 2021 lows the year yearly lows at the moment. What will push prices lower for the dollar? We need a catalyst. So I do think that if the news Generally is is Okay for the dollar. We should probably remain in this type of range between point is 90 to 9 89 20 to 97 area But again, if you want to get long on the dollar I would say definitely has to be driven by some sort of good news, right? So if prices do drift down to here, you want to be a buyer Wait for some sort of again positive sentiment positive catalyst to be a buyer of the dollar again This is just for dollar overall strength of weakness You'd go to you know dollar yen or the dollar Swiss for example to look for any kind of a buyer trades but use the dollar index as Confluence as for dollar strength or weakness and again if you're looking for any kind of short trades for dollar And dollar shorts you're looking for prices to really kind of come up a bit more and then look for any kind of shorts Well, you've been actually looking for shorts now and you know any of the dollar crosses as long as they're in you know supply zones So dollar a bit mixed for me not clear at all my my bias is probably more to the to the short side more short side Coming in the near term at least moving on to the dollar yen and the dollar yen again with With with the dollar not doing so great and the Japanese yen not doing great as well We did have a dollar drifting higher, but then kind of breaking through this supply zone But then coming really come coming back down into this area here of demand where we have demand right there to end the week So Again for me fundamentally, this is more of a difficult pair the yen isn't a strong pair at all They've got issues surrounding coronavirus and Obviously with some weak sentiment around the dollar potentially The direction of travel is is harder to kind of predict But if you do want to get involved in a dollar buy then this is probably the area to look for some buy trades Or if you're looking for you know this area here to look for some potential buying But I would say is to be just be mindful because the more times a level is touched the weaker It becomes so in fact probably this 108107 area would be the better area to look for long dollar trades if you're looking for Long yen trades or to short you the dollar Dollar yen and again, I would probably look for some sort of catalyst Maybe some sort of risk of sentiment. Yeah, because in the risk of environment meaning that there's fear uncertainty and Money tends to move into safe haven assets like the Japanese general safe haven currencies If you can get some risk of sentiment coming to the market and prices do come up to here this 110 Area and that would actually be a decent short trade Against the dollar moving on to the dollar Swiss and the dollar Swiss again Was had had some hopes matter of fact full prices to actually move to the upside but with again dollar Weakness coming in some disappointing jobs numbers probably going to see the dollar Range within this area here. I think within this these two demand zones 89 area round number But again similar to the dollar yen, I'm not keen on this currency pair For a long or a short at the moment. I'll probably would have been more long in this pair Had there been Some positive news, but now the bias really has changed and again if in doubt stay out There's not there's no point in forcing trades and dollar trades You know from a fundamental perspective if it's not clear you really want to look for you know divergences clear divergences in monetary policy And the the data but again if you do want to get sure you're looking at these areas here for short trades and Any areas here for long trades? But I would probably say again look for some sort of fundamental Catalyst to look for any kind of long or short trades on that currency pair moving on to the dollar cad And the dollar cad Biases more to the short side so any pullbacks into this one to two zone or even higher to the one two three would probably be Where my bias would lie if I'm trading this pair There really isn't any kind of strong demand at the moment even though there is a bit of demand right here It's not really strong. You can see where there's strong supplier, right? You can see where the way prices are moved This price hasn't price action hasn't proven that there's strong demand here So it's a bit of a tough one to actually look for any kind of Long trades especially with the fact that the Bank of Canada are looking to taper and the Fed are Not looking to taper. They're looking to be patient as we've previously seen here They're looking to be patient deliberately patient on tapering so You know with the Bank of Canada tapering You know that really the path of these resistances still to the short side in my opinion moving on to the New Zealand dollar US dollar and again, I think New Zealand dollar is one of the Currencies that I am buying and I'm in a couple of positions on the New Zealand dollar not necessarily against the US dollar, but I Think for for the foreseeable future that the New Zealand dollar should be a Bike and not financial advice, but you're seeing this play out as prices did come down into here Into this demand zone. We did get some some bullish Price say bullish price but bullish fundamental news for the New Zealand dollar earlier in the week and some negative Obviously or not not so great news for the US dollar and that should really be the catalyst for I think a higher New Zealand dollar US dollar exchange rate If you miss this or if prices don't work out then I think the again the bias to the upside is Just waiting for basically price to come down into this demand zone Understanding that you're buying the New Zealand dollar at a better price a cheaper area If you're looking for any kind of short trades, I'm gonna just move this over I think this is where your nearest supply zone is and if you do want to get short on the New Zealand dollar and buy the US dollar for some reason That's the first area and then this would be a nice technical area I do like this zone right here for a short trade technically, but just not fundamentally It's not on my list of pairs to go short on Moving on to the pound dollar And the pound dollar I think has definitely got some more upside potential again, especially with understanding the dollar weakness and some potential UK strength Bank of England plays down risk of runaway UK inflation Governor Bailey to policymakers say price gains a temporary investors expect Bank of England to hike rates as early as next year Which is always positive as long as the GDP Is also growing as well So Bank of England policymakers push back against concerns that the UK's rapid economic rebound Right economic rebound from the pandemic will lead to a damaging wave of inflation now central banks have a 2% inflation target and the I think the Mondays comments come after data show the UK inflation more than doubled in April to 1.5 So they're still below their their their 2% target, right? So he says if so here says said inflation will later return to the central banks 2% target as growth slows. So Basically the potential for a rate hike If inflation does start to pick up even more, but also as well The economy has to also do well for the for there to be any kind of Suggesting that there is going to be a rate hike and rate hikes are generally positive for a currency So they're a bit ahead of the US at the moment So any kind of pullbacks to a demand zone if we can get a pullback into that 140 area I think that's going to be a very nice buy technically and My bias would be to buy the pound over the dollar at the moment If you are looking for short trades buying the US dollar, then I think pretty much now Not too keen on this area to be fair But you would probably want to look for any kind of short trades And let me just let me just move this over any kind of short trades from this supply zone right here Not the best supply zone, but again, it's it's there If you want to look for any kind of short trades moving on to the euro dollar and the euro dollar Again, we did get a sell-off this week There was a nice little capture pain relief setup that trades on traders They did get involved in this week in the private mentoring group made a bit of money, but Unfortunately prices didn't continue to follow through and this is due to obviously fundamental drivers. So With the European Central Bank this week There's I guess a statement and press conference the ECB preview and they're looking to also avoid Talks about tapering. So but with higher inflation and accelerated vaccination rollout and a strong economic Rebound on the back of post lockdown reopenings Will put not only the ECB's asset purchase in front purchase of front-loading to the To the test next week Avoiding the T word so that's tapering word contributed to a pause in the climb of euro rates So again, if they talk about tapering then There's what they're suggesting is that rates should rise. So the exchange rate should get stronger We think this will resume after the meeting. So again more potential upside for the for the euro But also as well ECB pushing ahead with faster bond buying until September. So I think next week's meeting I Think they're probably gonna hold fire on any talk on tapering, but in September Is when they may start to talk about tapering? So if that is the case, we could still see prices start to range. I mean prices are due for a range especially after this You know, this this is quite a large move to the upside a good maybe was that 500 pips or so? To the upside with really no kind of pullback. So after a trending market We should get some sort of ranging market again the catalyst What is what is the catalyst that will push prices higher fundamentally if the ECB? Basically are not talking about tapering then We could see prices just literally range between where we are now or this high this one to two 664 area All right, so this area here that could be the high Or highs up here and really this where we are currently in this demand zone is one to one area So let's see what potentially happens this week But overall the path of these resistance is to the upside lots of forecasts talking about one two five being the the area Where the euro dollar exchange rate should go so any You know pullbacks into a demand zone. I think I'll definitely buying Opportunities as long as the data supports the narrative moving on to the euro Yen and the euro yen I've been trying to get into this for months to the long side and it just hasn't provide an opportunity But we do have and we a bit of a pullback into this zone now In fact, we've got one large quite a large demand zone Basically, it's like here So a lot of traders start to get you know start to complain and moan about the demand zones being a bit too Too much and when you get large demand zones like this The best thing to do is to understand where there is likely to be the most demand. Yeah So and we use support and resistance within these areas of large demand to understand that they were also going to be Support and resistance traders. So not only will we have you know, because prices are making higher highs and high lows, right? So we know that there's demand here, but within this large demand zone of probably about 200 pips We can break this zone down into understanding where traders likely to look for Trades and buy trades and you can see where we've got resistance Resistance support in this area. So I think this one three two point, you know, probably five area Half round half number is probably the really good zone to look for any kind of long trades If we can get that come back down to there from a daily timeframe perspective I also think probably now is decent, but with you're trading really at high So I'd really want to see a deep a better pullback to be fair before looking at getting Long also as well if that's the last swing low to swing high You really want to see Prices yet come down to fair value, you know, I want to see fair value or just below that fair value there I do like this this area here prices can come down. I do want to be a buyer in and around this area here but again, if you're looking for sell trades and buying the Yen then we pretty much looking for a pullback into this zone here before looking at getting Short again, I'd probably say Wait for risk off to really kind of occur before looking at any any kind of a short trades But I do think that the the euro yen is due for a deeper pullback. The catalyst could be The the ECB meeting but any pullbacks for me Even if prices do go through here through that through that zone there I do think I do want to be a buyer continue to be a buyer here because As long as Europe start catching up economically To to to other nations and the vaccine rollout. I think the euro is a buy especially over the the Japanese yen Moving on to Ozzy dollar Ozzy dollar. There was a really nice stop-hand setup Which I know a few traders got involved in not something I cover in this in this in these videos I do mainly just daily supply and demand zones, but there was a nice stop-hand below that area and It's working out so far From a demand zone perspective prices did come down into again This zone here pretty much pinged off it and then went to the upside so there was two ways really to get involved in this trade and How you really kind of get involved in the trade is when prices come down into the demand zone You go down into a lower time frame and look for entries in and around these areas, so There was a decent opportunity to get long and I think this is probably going to continue To go higher in at least a short-term anyway There is some supply just above here, but I do think with again some negative sentiment around the US dollar and positive Data around the Australian dollar. I think we should continue to drift Hire any pullbacks into demand. I think of buying opportunities So that's where we are with the Aussie dollar Aussie yen again risk off Sorry, I should say risk-on sentiment driving Prices higher and as well as you know really good data coming out for the Australian dollar should really see Prices drift higher prices do drift lower for me. It's just buying opportunities You know against the Japanese and the Japanese and really isn't a buyer at the moment in a risk-on environment So that's where we are, but technically if you do want to get sure I think this this supply zone from the 8550 area is actually quite a decent zone to look for short-trades technically just not fundamentally and really prices driven by fundamentals and risk sentiment in the medium to long-term in the short term it's more to do with liquidity and avoidance of slippage, I guess So there is an opportunity to get short if you want to get short here but the parvalees resistance again is still to the upside and Finally gold gold benefiting really from Dollar weakness as well as inflation concerns Again as I just reiterated well say reiterated, but I said previously Fundamentals are really key to understanding which direction you should trade in there's no technical level That's gonna stand in the way of Value and that's what fundamentals really telling you is where value is potentially on a price chart Are we inexpensive a bargain area and then you know we look for you know potential pullbacks, right? But that supplies on there doesn't look like it didn't look it was gonna hold Now again gold being driven more by a weaker dollar and Inflation concerns gold rebounds This was a from Friday's article as US payrolls data ease concerns over stimulus. So the dollar And and gold tend to work inversely and Any bad news or negative sentiment towards the dollar which there is you could pretty much see You know gold start to Make higher highs so as long as the inflation theme is still in place as long as the Federal Reserve is still printing money And not talking about tapering and as long as there's very sentiment overall on the dollar You should continue to see gold make you know new highs. So any pullbacks, I think into this area here This this demand zone should be Definitely a buy trade or if prices make new highs and then you're looking for pullbacks into demand zones if there is any kind of positive news around the dollar and the Fed start to get a bit more hawkish and start to talk about removing tapering then Really and truly that's when you want to start to look for short trades But yeah, the path for these resistance is to the upside when it comes to gold So again any pullbacks is buying opportunities as long as again the data supports the narrative And when I say the data supports the narrative, you're looking at again more weak dollar if jobs You know a lagging behind and any kind of weak data for the for the US economy and Barry sentiment or dovetail sentiment for the Fed then it's just literally keep continuing to buy gold Anyways guys, that's it for this week again. Don't forget to like subscribe share if you find the content useful and Take care and I'll speak to you all soon