 Hi, my name is Leon Rowe, currency trader and trading coach at Trading180.com and welcome to this week's supply and demand for us and gold fundamental and technical analysis for the week ahead, starting the 3rd of March. I hope you had a great trading week and if you find the videos that I provide every Sunday of use, please don't forget to like, subscribe and share the video content across all platforms if you can. It's a free way to support the channel and shows your appreciation. So getting into the week ahead and this is from Trading Economics and so in the upcoming week, investors will closely track the United States' January label report and speeches by several Federal Reserve officials including Fed Chair Powell's semi-annual monetary policy reports to Congress. Also key US indicators like the ISM Services PMI, Jolt's job openings, factory orders and foreign trade data will be under scrutiny. Internationally, the focus will be on the European Central Bank and the Bank of Canada interest rate decisions. That will be definitely important. Both banks are actually expected to hold rates, but it's really about the forthcoming cuts and when they are likely to happen. So the market will get clues as to what the central bankers are thinking. So where are we at now? Sorry, we've got interest rate decisions alongside inflation rates in Switzerland. GDP growth rates for Australia will also be monitored. Finally, trade data for major exporters such as Germany, Australia, China and Canada will be closely watched along with services PMI for China. So fairly a lot going on this week especially in the United States and yeah another busy week. So beginning of the month. Now before we get into the weekly analysis, just I guess I've got some trade analysis on the Euro Australian dollar and this was a trade that I'd entered into this week and if you are in the member's area, you'll be able to see the analysis in the trading videos area. And if you click on the 28th of February, our group call that we have every Wednesday live group call via zoom. And if you go to about the one minute nine mark, you'll see that this was the Euro Australian dollar. And I was talking about the potential for a stop hunt in this video. So you can see the breakdown of the actual trade setup if you remember there but in this video what I am going to do is just really kind of go over the main the main entry in terms of you know where I got in and how the trade has played out so far. So stop hunt did actually work out quite nice. I didn't enter on the hourly timeframe but just for ease of understanding I guess it's better that I go down to the hourly. So I was expecting a stop hunt to happen above this level which it did happen now. What I ended up doing was as soon as around about nine o'clock, this is a this morning, but on Thursday morning, I entered into three positions or managed to get into three positions. So one was actually at the 1.6648 level. Then I set two pending orders one at the 1.6671 and then another one at the 1.6692 area. So right at these highs and the the hope is that obviously prices either go in my direction or I can get a better price if prices do end up pulling back and nobody knows how far they're going to pull back to. And then I'm looking at getting hopefully taking some positions off as prices go in my favor. The stop losses on each trade are all at the same position right right there. And so on each position what I'm looking for the first two positions I'm looking for at least a one to one to get myself to at least some sort of break even overall or at least a profitable position. Then what I'll do is I'll swing trade this last position. So as we go forward you can see prices you know obviously work were coming up and so triggered me into the 50% pending order and also as well managed to trigger my final position 50%. Now at this point in time it does feel I'm used to it now but it can feel uncomfortable because you know you're thinking to yourself what prices are going against me. The thing with the fundamental analysis and applying fundamental analysis is understanding that if you're right about this trade and this is actually a bargain price which I thought it was I wanted to be a buyer of the Australian dollar over the over the euro and that was also as well if you got access to the fundamental analysis spreadsheet and you remember you'll note that I was short I had a short bias on the euro Australian dollar and that never changed as well and that again was broken down in the members video area and if you're right about the fundamentals if I'm right about the fundamentals prices even though they might pull back they may not want to go too far above this area so that's the reason why I try to enter into three positions if price would obviously allow that to happen and as you can see prices did get me into three positions now at this point I'm trying to take off at least a one-to-one on this on this third position which ended up happening so as it came down as it came down it basically my stock loss sorry my take profit was was was around here at the one six six four three so that position ended up being a winner and then now I'm looking for at least a one-to-one on this second position yeah so it didn't quite happen there and then it happened right there so that was the second position at a one to one so now I am profitable actually I was profitable before that because I tend to go a bit heavier and increase my position size as prices go against me so now I'm actually profitable and so it's now about just swing trading this position this euro Australian position and again really from a fundamental perspective the reason why I'm looking to buy the Australian dollar over the euro over the euro is because the RBA the Reserve Bank of Australia are looking to cut rates later than the in the European Central Bank so that really should give it a bit of an advantage at certain levels and so I was right this week on this trade and so far now this is going to be a trade that I will look to swing trade looking at daily targets of course and trying to maybe get you know prices to kind of maybe come down a bit further around here pull that out yep so prices to maybe come down to somewhere around these lows if not slightly lower I'll just trail my stop on that one so nice trade on that so far also I'm in the New Zealand dollar US dollar long I won't necessarily break that down this week but I have broken that down also as well in the members area video and the second of March weekly fundamental and technical analysis video for the members I break down the trades that I'm in also as well and just to give a bit of a trade update as well from last week on the CAD yen so again this was from last week so you can watch last week's breakdown and and see what this whole scenario was again another stop on situation I go down into the lower time frames and again same principle in the same approach I entered into the market order here and I entered into another trade at the 50% and also one at the 95% now the 95% trade ended up being profitable last week and you can again go and see that in last week's Sunday video analysis so it reached as we got triggered in here prices came down and then I was only in really two positions which was the market order and the and the actual 50% retracement right and then this week we had price again come down and hit a nice one-to-one trade which was here right and that was on the the Thursday you know I was asleep then so it was nice to wake up to some profit there on this trade in fact that wasn't where the one-to-one was it was right there so that would have been in the pullback entry sell and then about a week later yeah Wednesday and then to Wednesday took about a week to get there but ended up taking profit off there and now I'm just in this trade which is the original market order around the one 1098 and again looking for higher timeframe targets on this one and hopefully again I can swing trade this down with the fact that the Bank of Japan are going to be the only central bank this year to high crates and so from a from a currency evaluation perspective the yen hopefully should want to you know fall away in it and and appreciate over the Canadian dollar so that's really where I am with the cad yen and also as well the Euro Aussie so both profitable trades running and also as well have a couple of other trades that I got into last week but I might go over those next week regardless of whether they win or lose I'll go over at least one of them and so yeah that's really it for the trade analysis so let's get into the week ahead and the week ahead starting off on the dollar index and the dollar index is a equally weighted dollar index with a calculation if you want to know this calculation then if you go to the YouTube channel you scroll to the trading one at YouTube channel and then go to Forex strategy using equally weighted index to identify the best Forex setups and pairs there's the calculation on how to add that to your trading view charts and so this week for the dollar I was just telling the members that I've been bullish pretty much since the beginning of the year I had some decent dollar trades but now I think that the dollar may start to I guess start to sorry yeah start to maybe sell off a little bit I think the really really the main reason is because I think whatever's priced into the market in terms of rate hikes has been and rate cuts sorry has been priced in and so in order for really prices to go much higher beyond this level and of course prices can go higher but for prices to really continue you know on its upward movement what would have to happen is for really you know signs of inflation going higher as well as the economy growing now from Jerome Powell's perspective he is being quite hawkish so it says here's the feds pal doubled down on no rush to cut message so you know set pieces include Fed testimony China Congress and UK budget ECB and Bank of Canada may keep interest rates unchanged and so it says here the Federal Reserve Jerome Powell is expected to double down on his message that there is no rush to cut interest rates especially after fresh inflation data showed that price pressures persist so they need to get inflation down really to look to potentially cut rates and it says here Powell is headed to Capitol Hill where he deliver his semi-annual monetary policy testimony to a house committee on Wednesday and the Senate panel on Thursday the US central bank chief and nearly all of his colleagues have said in recent weeks that they can afford to be patient in deciding when to cut rates given the underlying strength in the economy the danger of moving too soon in cutting is that the job is not quite done and that the really good readings we've had for the last six months somehow turn out to be or not to be true or a true indicator of where inflation is heading Powell said in an interview with CBS 60 minutes on February the 5th earlier in the month so earlier last month and it says that cautious approach has been vindicated or validated in recent weeks by data showing inflation picked up last month but it's not likely to satisfy Democrats who are anxious about the path of rates could affect the November presidential election and down ballot races they're expected to to press the Fed chief and why officials are keeping borrowing costs so high risking damage to the economy when they've made so much progress on inflation and in fact earlier in the year I was saying I think one of one of the first videos I made this year was on the fact that the Federal Reserve are likely to cut rates this year and it's really to do with the election cycle and so you know politicians may put in pressure on the Fed to actually cut rates so cut rate rate cuts are coming so but at the moment the CME Fed watch tool the probability of that rate cut is priced in June so you'll see here it says May top top left in May's announcement there's still 81% of a no change in June is when you start to see the probability of an ease to 63.3% and as that starts to increase what you'll start to see is the dollar look to devalue right and so I do think that although the dollar isn't an all-out sell here I do think that the upside is likely limited and so I am now looking for the potential for some short trades I do think that the dollar is a bit expensive in this area so I'm thinking that prices are likely to potentially pull back not too sure if it would do it this week hopefully it does of course but if it does then I will be a bit happier with that anyway but overall I think the dollar should want to pull back to some degree or at least at the very least the upside upside potential is likely to be to be capped one of the other data points that came out this week was that the US manufacturing gauge drops as industry struggles for momentum so ISM factory index declined 1.3 points in February and new orders productions and employment measures decreased so a measure of US factory activity shrank at a faster pace in February as orders production and employment contracted suggesting manufacturing is struggling for momentum so it says here the latest figures are a setback for the nation's purchasing and supply and management executives who have been optimistic that the US manufacturing is on the cusp of expanding after being stuck in contraction territory since late 2022 so if we look at the you know the manufacturing which is a forward-looking indicator as well of how the economy is doing right and so again if GDP you know manufacturing is a component of GDP and if manufacturing struggling then it hurts you know the GDP reading right and so I do think that potentially the tide is turning in terms of dollar strength now obviously the most difficult thing is the timing but overall looking at where we are I do think that if prices do go higher it shouldn't be much higher and I do think that the path now release resistance is probably to the downside as we start to now auction between a high and a low and traders will say well what is an auction really just an auction is another word for it would be to kind of range between this high and this low potentially or maybe slightly higher in terms of that high and this low so this is where I do think that the dollar is likely to want to stay between in terms of where prices are likely to stay between so for me I think the dollar is a bit on the expensive side opportunity to short of course if Fed chair power comes out and is very hawkish then you may see a bit more upside but overall I think in the next month or two as we head closer to June I do think that the dollars strength is likely to to wane a little bit but it's not necessarily an all-out sell I think you can also buy on the dips as well if you do believe that the dollar is a bargain at certain demand zones and also as well not to forget that the data needs to support the narrative so if the data does support later break hikes meaning that you know data comes out and all of a sudden the Fed start to you know maybe plan for a July cut rather than a June cut then in fact you will have a stronger dollar overall but it also depends and I could be you know work the other way right in terms of if data comes out and doesn't support rate cuts in June in fact it maybe brings it forward to May then you're likely to see the dollar actually sell off a lot a lot more so data is still important data dependent and let's see what happens with the dollar but I think you know in the coming weeks I think that the upside is capped for the dollar in terms of any kind of dollar strength looking at the dollar dollar yen the dollar yen this week we did come up to this supply zone right here where we've got that area and we have reacted prices haven't necessarily you know move to the upside this week we did also have I guess a rumor really start to circulate that the Bank of Japan could potentially start to hike rates for the first time since I think 2007 in March so it's expected to really happen you know March April maybe latest in June and it says here the headline is the Bank of Japan risks roiling markets with traders underprepared for March so 7 of 15 economists see a March policy shift as possible and swaps point to 34 percent chance of hike by March and 85 percent by April so the you know the closer we get to March April and the more likely it looks like the the Bank of Japan are gonna hike rates then you should really start to have prices move to the downside although of course in the short-term prices could move you know higher and you know clear out some of the some of the liquidity especially above that area as well that's gonna be a very nice level where you know above that 152 where there's gonna be a lot of liquidity above there but overall the closer we get to rate hikes is the hopefully the stronger the Japanese yen should become so this pair is not necessarily one that I am very bullish on but I think once the divergence starts to play out in terms of in terms of the dollar cutting rates and the Fed cutting rates and the Bank of Japan hiking rates then what should happen is you should really get a situation where the dollar yen starts to drop and fall towards at least a 140 so you can prepare yourself for that which I am but not just yet and I think it's happening just just just yet so let's see what happens there dollar CAD and dollar CAD this week you have a nice supply zone that has been tested the dollar CAD is necessarily a pair that I'm interested in buying or trading at the moment that's a nice area of demand wide area of demand that I do think that within that wide area of demand if I'm looking for any kind of trades it'll be in you'd have to have the confluence of some sort of support and resistance I do think that area is decent you've probably got some intraday support in there as well so if you are looking for buy trades looking for pullbacks if you're looking for a trade right now then that's decent for a sell trade in terms of buying the Canadian dollar but ultimately not really interested in taking this pair but if you are a decent area to look for some short trades currently looking at the pound dollar and the pound dollar has been really within this this whole range or auction for actually quite a while so two strong currencies and I think I do think that the British pound does have a bit of an edge again the main reason for the edge is that the Bank of England are looking to cut later than the Federal Reserve so it says here cuts to interest rates still some way off says Bank of England economist and so the Bank of England top economist has said he believes a cut to UK interest rates are still some way off Hugh Pyl the Chief Economist at the Central Bank also warned that the economy is currently weak and said policymakers should not feel a false sense of security if inflation falls below the 2% target rate in the coming months it says here economists and banks have widely predicted that the Bank of England's monetary policy committee could opt for its first cut since the start of COVID-19 pandemic at the first in the first half of the year however Mr. Pyl became the latest Bank of England rates setter to appear cautious about potential future rate cuts in my baseline scenario the time for cutting rate bank rate remains some way off and he says I need to see more compelling evidence that the underlying persistent component of CPI consumer prices index inflation is being squeezed down to rates consistent with the lasting and sustainable achievement of 2% inflation target before voting to lower bank rates so until that starts to happen he's going to be quite hawkish and so you know the the market I think is pricing in rate cuts for August so whereas you will have maybe the the market pricing in a rate cut in June and a rate sorry a rate yeah rate cut in June and a rate cut in in August the the central bank that is cutting later is typically the one that you want to buy so from that perspective yeah the the pound on pullbacks is likely to be or should be really the buy if you're trading the interest rate leading and lagging trade ideas any pullbacks there and again looking at from a demand zone perspective yeah probably back it back down into into that zone right there in fact probably down into there if you are looking at buying the dollar over the pound then you are looking at any moves back up to that supply zone there before looking at getting short pound yen and the pound yen I think now is looking decent for a potential sell not necessarily the best supply zone in the in the world but with the Bank of Japan really the only bank looking at hiking rates then the yen should really be the the buy out of the two so I do think that any pullbacks now into this zone again like I said not necessarily the best supply zone reason being because we haven't taken out any kind of demand yet but any pullbacks into that area should be nice for a potential sell or if you're looking for stoppons just above that if you are still looking to buy the the pound then probably from now or maybe a bit of a deeper pullback into that zone and for extra confluence you might want to wait for an area where you have support and resistance within that area of demand as well looking at the euro dollar so the euro dollar this week I think the euro is strengthening really just based off of some a bit of dollar weakness and so because of the recent ISM data I think you did have a move to the upside whether that's going to be sustained or not is is a tough one I mean I've my bias is really to kind of is to kind of still short the euro I'm not really keen on buying a euro at all but the euro could be a buy against the dollar on a pullback if you start to see more dollar weakness so that's a decent also as well if you are being if you do want to be a buyer of the euro I think anywhere in and around this this support resistance and just below that area there is nice technically if you are looking to buy the dollar over the euro then I would probably wait for something around the 109s 109 20s before looking at getting shorts and you do also have a decent area of support resistance on that daily time frame in and around there so where prices have been traded quite significantly so that adds to again some sort of confluence if you are looking for short trades on the dollar my bias would still be although again I'm thinking that obviously the dollar can be a buy and a sell against the the euro I still think the dollar is likely to be a buy but this week is going to definitely be a pivotal week looking at the euro euro yen and the euro yen I was in this last week as well actually got stopped out by about two or three pips but managed to re-enter on an intraday stop hunt and get some of that money back so still a little bit down on this on this overall trade idea but let's see how this plays out I'm in one position on this so but from a supply and demand perspective again it's really just understanding that I want to be a buyer of the yen at the moment and I think the euro could again strengthen in the short term I think overall the yen should really be the buy in terms of this should be really be a short on this currency pair but let's see what happens here if my other position I've made some money on one position only managed to get in on two positions and if the one I'm swing trading at the moment gets stopped out then I'll just wait for another opportunity to get in short on this because I do think that the euro yen should want to roll over hopefully and let's see what happens there if you do want to be a buyer though if you don't want to be a buyer on this and buy the euro against the yen then you've got an area of demand in and around here which is decent and also as well you've got some decent confluence when it comes to a level that has been traded support and resistance within that demand zone so quite nice there quite nice technically euro pound euro pound is a trade that I really want to get short on but haven't had the opportunity to so let's see what happens this week some supply zones I'm looking for pullback we've got again a decent level of support there and resistance so yeah I do think I want to be a buyer of the pound over the euro so any pullbacks that go higher that's where I want to be a get short and buy the the British pound or even better would be somewhere around this level so let's see what happens there I think also as well this level is open to a bit of a stop hunt around that 0.858 level so again I'm just got my eye on this for sure if you're looking at buy trades though looking at buy trades and buying the euro then really a pullback into that demand zone down at the bottom would be really the best opportunity I think as well that is kind of backed up by the fact that you've got this right term is capture pain relief trade right that area just below the level is a known as a CPR trade setup so quite nice technically but fundamentally you really want to be buying the more I can't tell you what to do but I want to be buying the other British pounds so that's where my bias is on this pair Aussie dollar Aussie dollar you do have some supply now I think the Australian dollar is a buy overall and I'm watching this trade I'm watching this pair simply just to look for some buy trades I'm not totally convinced just yet that the Australian dollar is a buy against the the US dollar but I do have my my eye on this pair and so again any pullbacks if you're looking to buy the Australian dollar and if you're looking for sell trades you're probably looking for pullback around here yes any pullbacks up into maybe the highs of this area even a bit higher where you've got a fresher area of supply around this 0.66 round number and just above that it's going to be nice technically for a short trade if it does happen this week but I think if there's going to be some dollar weakness this week then you know prices should want to move to the upside but let's see what happens also as well prices does they do break through that area there then you do have a decent area of demand at these lows so I think if it comes down here that should be a decent pullback for a potential buy and looking at gold gold flew on Friday and that was really kind of due to again the US data so gold rises to nine week high as US data reinforces rate cut bets and so manufacturing gauge drops as in industry struggles for momentum and bullying is on track for second consecutive weekly gain and so gold rose to the highest in nine weeks as disappointing US factory data and a drop in consumer sentiment reinforced bets on the possibility of interest rate cuts later this year signs of a softening economy solidified expectations that the Federal Reserve will need to lower borrowing costs to help shore up the economy higher rates are typically negative for non-yielding bullions so you know when you look at a price chart and I've mentioned this several times but whenever you see a price of gold and you see yields bond yields go in higher typically that has a negative effect on gold main reason is because money tends to float into assets that provide a yield right so gold holding gold doesn't provide a yield you want some easy money right and so I rather get paid you know four percent for holding government bonds is a mentality not necessarily personally but you know certain financial institutions tend to hold want to hold bond yields and get paid a yield rather than holding gold and waiting for just the price to appreciate so from that perspective gold kind of has struggled a bit but you can see it's making this way higher as you know the expectation of slowdown in the economy in the US economy starts to come to fruition if that does then obviously gold should be the buy as we head into the economic recession cycle or part of the cycle so we've got some demand zones around here here and right there as well if you do want to be a buyer of gold really looking for pullbacks if you're looking to be a seller of gold you do have quite a wide area of supply technical technically you do but from just looking at within that area and looking at levels really the levels you're looking for and a point of reference would be these two areas here I don't think you've got anything else to kind of refer and when I say refer as in you know support and resistances on the daily time frame chart is just looking at where institutions have done business right so they definitely thought that this was expensive for gold they thought it was expensive you know it spiked through where it was expensive again expensive again now will they think that gold is expensive here potentially potentially not who knows but if not then the next area to really kind of look for where price may be expensive is going to be all the way at these highs so as a point of reference looking at support and resistance you know it's either going to be here prices may reverse or prices may reverse around here if the market thinks that gold is expensive if you're looking to be a buyer though then you're looking at buys down into these demand zones potentially down at these lows so as the market and the US economy starts to call and potentially head into the contraction phase and potential recession phase you what should happen ultimately is actually gold should continue to go higher because we're then entering into the rate cutting cycle when in the rate cutting cycle of the rate cutting cycle where gold typically does do and appreciates so let's see what happens going forward over the next few months so that's it for this week I hope you enjoyed the content and found it useful hope you have a great trading week and speak to you soon have a blessed week all the best