 Hi, my name is Leon Roe, Covenancy Trader and Trading Coach at Trading180.com and welcome to this week's Supply and Demand Forex Technical Analysis. If you're new, welcome and if you're returning, welcome back and I hope that you find my Supply and Demand Technical Analysis as well as the fundamentals useful every week and if you are new and don't know, you can skip to your favourite pairs on the technical side, there is the pairs of time stamped in the description box below but I prefer if you obviously watch everything because you need to see the whole picture and we start off as we do on the fundamentals and sentiment analysis and pretty much just get a recap of what happened last week and what's coming up this week. So, last week, if we go to Forex Factory, we had a busy week. First of all, Japan, there was the Japan Monetary Policy Statement and pretty much they held Stan's Pat and Trim's Inflation Outlook, you know, ahead of expected rate cuts. So they basically, with the hot potato rather than cutting before the Fed they pretty much said, alright then, well, it's over to you first and see what the Federal Reserve do. So then all the eyes were on the Federal Reserve cutting rates and the Fed Reserve do cut rates on Wednesday the 31st, the first time they cut rates in a decade to 0.25, which was expected it was either going to be 0.5% which was the deeper cut or it was going to be a no cut which would have been the surprise ones but this was the expected cut at 0.25, almost known as an insurance cut and the sooner the Federal Reserve done that, the day after, Donald Trump decides that he will impose 10% tariffs on other goods, 300 billion of Chinese goods starting September the 1st and this really kind of surprised the markets, surprised everybody, you know, surprised tariff and that announcement came after US and China. We started trade talks in Shanghai this week, just everything was going swimmingly I guess and then all of a sudden he throws his toys out the pram I guess just trying to strengthen his negotiating position, he wants a weaker dollar and as you'll see on a price chart the dollar actually did the opposite to what a lot of people expected which is it actually gained in strength after a rate cut. So I guess he tried to bring the dollar back down to earth and again strengthen, try to get some more leverage and really kind of speed up these trade talks and I guess try and come to some sort of conclusion. So then the markets kind of sold off as you'll see and the yen ended up strengthening and then we had the non-farm payrolls and on Friday US economy added 164,000 jobs in July which was pretty much as expected, going back to Forest Factory and there was really no surprises there as expected and that's how it came out. So again no real surprises but today there was some positive news I guess Trump says things going well with China after tariff shock so President Donald Trump said things are going along very well with China and two days after his move to threaten tariffs of hundreds of millions of dollars in additional China's imports sent global stock markets tumbling not only that it rattled the forex market and especially if you were trading risk off you definitely would have made a little bit of money buying the Japanese yen and yeah we'll see that on the price chart So looking to this week what we've got is the US by some non-manufacturing jobs job reports and producer prices which are going to be important for inflation UK quarter two GDP growth and there was a Bank of England news as well but they pretty much are in a holding position they have to kind of wait and see what's going on with Brexit so there wasn't too much movement on the pound this week but that's going to be important as well GDP growth, business investment, foreign trade all probably expected to slow Germany factory orders and trade balance again that's going to be very important for the euro zone the euro in general as Germany is the euro's powerhouse and if that's continuing to slow down, Mario Draghi has already said the week before last that they're going to introduce stimulus so this just adds to the narrative of that Germany's factory orders are struggling China trade figures, inflation and services, PMI China news is always important because they are the world's I guess economic engine and if they start to slow down you'll see in the effect really of the Trump's trade potential trade war and who's winning and who's losing if anyone is winning or losing but it also affects the world and mostly Australia and New Zealand and then you've got Japan's second quarter GDP growth again very important I think and this is due to the Bank of Japan adding stimulus if the second quarter GDP growth slows then there's going to be again adds to the narrative and the need for the Bank of Japan to really kind of add stimulus to kind of stimulate the economy, cheap money it's always good for the economy so they need a weaker and they also need a weaker yen and Australia trade balance is going to be important as well and that's for GDP, investors will also react to central bank policy meetings in Australia, New Zealand and India and if you go to Forex Factory this week you've got a lot of New Zealand news employment change unemployment rates expected to kind of grow on both inflation expectations always important and then important cash rate for the Aussie I should say they expected to hold this week and then you've got a statement but you've also got the cash rate for New Zealand they're actually expected to cut on Wednesday so all central banks are pretty much cutting and then you've got the press conferences, trade balances et cetera, et cetera, pound GDP month for month and then you've also towards the end of the week really you've got kind of CAD news employment change, unemployment rate and then core PPI so for the dollar it's a very, very light week and it's more I guess focusing on China, Australia and New Zealand so if you do want to find out more about fundamentals and how to trade fundamental analysis and what this all really means then there's a free fundamental analysis course link is in the description box below loads of modules there and also show you how to a one way of how to trade the news but yeah, pretty comprehensive and it's all free and discover really why fundamental and resentment is the real reason why one of the main reasons why the markets move so let's get into the technical analysis and we're going to start off as we always do on the Dow Jones dollar index and the dollar index so this week prices came, well last week I said prices came down into up into the supply zone and dollar index just a measure of dollar strength versus the other major currencies euro, yen, pound and Australian dollar and what you saw was instead of really kind of selling off which again, a lot of traders expected the dollar to do it just kind of kept going from strength to strength right up into the actual rate cut continued to go slightly higher and then Donald Trump kind of opened up his mouth and said what he said about the trade tariffs so market kind of did the opposite really and there was obviously demand for the dollar leading up to the rate cut and how we use the Dow Jones dollar index is just simply to look for confluence if the dollar start and the dollar index is selling off then you want to look for any dollar crosses to sell off as well because that would indicate some dollar weakness but didn't get it this week and into the end back ended a week Thursday, Friday seeing the Dow Jones starting to pull back markets have to pull back at some point so if we go to the chart and update it what we'll see is we can delete that and what we actually have is a demand zone right here, it's hidden demand for those of you that have taken the course and potentially what we could see is a move higher from here if you are very bullish on the dollar but I think markets have really moved quite high so potentially what we could see is prices and the dollar start to sell off I can delete that for now or what we may see is prices go through that demand zone and if it starts to create higher highs higher lows then we know that there's some demand there then we'll wait for it to pull back into that demand zone before prices you know go higher so many scenarios to look for with the dollar index and what we're looking for if you're looking to buy the dollar is for those types of scenarios to play out if you're looking for supply at the moment there is some supply here but until this area really gets you know starts to move past that area of demands then what you want to do is wait for a pullback into that newly created supply zone and then again this would be confirmation so you'd be waiting for any kind of bearish price action on this and then looking for bearish price action against the dollar on any of the dollar crosses so moving on to the dollar yen and so last week prices came up into the supply zone and then held held held and then bit of a fake out stop hunt set up was right here and then due to risk off the yen literally you know strengthened and if what Donald Trump is saying is true and going back to his everything going well at the moment if that is to be believed then this could be a great buy an opportunity a really really good buy an opportunity you know for the dollar as the yen won't really strengthen in a risk off environment it'd be risk on again so the dollar is the stronger out of the two economically so we go to the charts and update the chart there we go so there was really no demand at any of these prices but potentially there could be demand here now it's closed below this demand zone so I'm going to delete it and what we'd have to see is prices you know to kind of make again higher highs higher lows and then what you want to see is prices come back to this created demand zone before looking at long trades so yeah I think that's really the play well done to you guys and if you did manage to get short at this level and then this is going to be really where the short trade is you need price to come all the kind of up to here before looking at any kind of short trades let's just put this back so you need price to come really come back up to this one away or what you could see another scenario is for prices to kind of pull back to a level and then create a new low and if it does that then that would create a supply zone and then you'd be looking for any kind of price to come into that supply zone before looking to get short so that's those are scenarios you're looking for moving on to the dollar Swiss and the dollar Swiss again just like the yen the Swiss franc actually strengthened due to risk off and again decent trade another stop hunt around here and prices are now into this demand zone which actually looks quite decent I do like this and especially if if again risk is back on again the Swiss franc there was also some news for the Swiss franc last week and it was actually terrible was it on here no but it was definitely um the Swiss franc came out as I think it was their GDP numbers or something like that that was actually terrible I think it was inflation inflation was that minus five so they're further or further away from their two percent target and so it's not looking very good for the Swiss franc so I want to be a buyer I'm going to look to be a buyer in here if not a buyer down into this demand zone but let's go to the charts and see if anything needs updating so we've got that level there so right now it's a decent buy I do like this if not then it's going to be I'm going to be a buyer down here dollar yes the dollar is weakening but out of the two I'd rather be a buyer with a dollar as if risk is on if risk is off if risk continues to stay off as the market opens on the Sunday evening UK time Monday and the headlines are really bearish and stuff like that and the reports coming out that Donald Trump is still wants to impose tariffs etc and what you're looking for is a pullback into supply and then looking for shorts or you're looking for a move down you know move up into a level and then move down as long as this creates some sort of supply zone as well yeah so dollar Swiss moving on to the dollar CAD dollar CAD again price came up into this supply zone you know touched it a few times and now we have a decent pinball formation this could be profit taken this could be a reversal if the dollar weakens then this will look like a a definite reversal I'm still a buyer with a dollar over the CAD anyway so any pullbacks you know into demand is going to be where I'm going to look for prices this week as well you did notice that prices came up into this you know came up and then came down into this demand zone giving a nice buying opportunity on the lower time frame as well so if you managed to get involved in that well done but in the face of rate cuts not many people probably would have taken that you know that trade long and you can see there was definitely a few pips in that so waiting for really price to come back down into this zone this is not hidden actually it's hidden no it's not hidden hidden demand this will still be a demand zone or that right preferably down into this 1.3 you know near round number if I can get a buying opportunity let's go to live chart and updates so what do we have I'll keep that zone there that zone will come down to here and everything put my stays where it is so right now Monday opens you know trade some dollar weakness if there is dollar weakness then looking for pretty much an obvious trade right there if you want to trade that pin bar price to maybe on the intro they come up slightly retrace a little bit and then you know giving you a bit more of this reward but again we're waiting for prices to come up they may not come up and you may miss the trade so there's always pros and cons to you know that idea and you wait for price to really kind of come down into here before looking for buy trades or buy trade here so dollar CAD I think as well we've got some CAD news this week employment so depends on really what you want to look to do with the CAD and what you really are forecasts are for the Canadian dollar, New Zealand dollar, US dollar and pretty much this week it's sold off there was really no demand at that price up until now and I think this is really kind of happened it's kind of a bit late to the party on this one didn't realise that they were going to cut or potentially cut I thought they were really going to hold rates but the market seems to think that they're going to cut rates on Wednesday so I think it's about the rumour sell the fact so even though dollar cut rates dollar being the strongest out of the major currencies I think the New Zealand dollar also cutting rates has weakened or potentially cutting rates has weakened the New Zealand dollar so going to the chart let's see pretty much just delete that and delete this now with this kind of price action if prices are really kind of weakening into a rate cut again by the rumour sell the fact that the market is probably pricing in a rate cut now at the time of the rate cut on Wednesday prices are already going to be at probably a low zone so how much further could this really go down especially if the dollars are also cutting rates so I think this potentially could be a decent buying opportunity but I wouldn't do it necessarily I personally wouldn't do it against the US dollar there are definitely better currencies to buy the New Zealand dollar against but if you did want to get long then now is a decent time just be careful as well although that this level has touched once, twice so it's not the freshest area to look for long trades if you are looking to get short on this currency pair at the moment it's literally up here before looking at short trades or again just looking for a positive move and then looking for a move to come down and then look for prices to come back to that supply zone so that would be a lower high created, lower low and then once that's created you go back to there and then look at short trades so New Zealand dollar at the moment coming down into a decent zone if you want to be a buyer of the New Zealand dollar and again all central banks are cutting rates if it was just one central bank cutting rates then or the New Zealand dollar was RBNZ was the only one cutting rates then it might be a bit of a dangerous move buying just after a rate cut but with all central banks cutting then this still could be potentially a buy moving on to the pound dollar pound dollar with Brexit and a lot of uncertainty prices have literally just sold off this week why you'd really want to buy the dollar is is it's not really fundamentally or even sentiment wise a trade that makes any more much sense so yes no demand at that zone not surprisingly and now we've come down into a longer term demand zone last week so I'm looking at pound dollar going to delete this and this was a long term demand zone from way back in 2017 now what you probably want to see is if you're looking to get long if you're looking for you know it pretty an opportunity now if you're looking to get short technically we've actually created a supply zone but what I'm going to do with this one is I'm going to move this here give that bit of space and you've got supply zone there because we've made lower highs lower lows so supply so what you're looking for is actually for price to come say on the intraday let's say for example you trade in a 1 hour time frame as you can see where the supply starts and that's where supply is strongest so you're looking at price to come up into this zone here before looking at any kind of short trades but keep in mind as well that you are buying the dollar at an expensive area you are buying at an expensive area because look where we are looking into the context of things you're buying the dollar at highs even though yes prices have gone down but you're buying the dollar selling into shorting into after a move has already gone short the best thing to do is maybe look for potential pull backs so if you do get some good dollar cent and pound sentiment then this is really the ultimate place to kind of get short and that's where I'm looking to get short unless again proof of value prices really start to make their ways lower again and then this will be the zone to get short on so moving on to the euro dollar euro dollar again what we expected and what the market expected was for really the dollar to kind of weaken and of course prices went lower then Donald Trump came out with what he came out with and then we got some dollar weakness so pretty ended up taking out all the stocks that were below here below this level and now we're getting a bit of a pullback but this is a decent shorting opportunity this week so euro dollar if we delete that but there's a bit of supply in this area so as market starts to pull back this is where we are looking to get short on this you know this area between this 1.114 to 1.119 899 level is where looking to get short if not that would be the short trade you know around this 1.1224 level and further up so decent if we're looking at demand and looking to buy there's really no demand on the daily until again it's difficult to say that whether there's going to be really kind of any demand that's going to hold from you know 2017 sometimes it does sometimes it doesn't but it's a zone anyway to look out for let's see the market will create its own actually is there a bit of a zone here it might be let's see or is that gone I'm going to keep that there matter of fact I'm actually going to keep that there put that there and then so there we go you can see where it's actually held from that level so demand right now if you did want to be you know buy got a bit of a pinball there dollar weakness you know could occur this week and then that would be a decent buying opportunity if you wanted to buy the Euro but just keep in mind that the Euro is definitely the weaker out of two so this wouldn't be any you know trade that I would hold for any length of time doesn't mean that prices can't come up further and further but you have to be the obviously the judge of that as fundamentals and sentiment is what kind of moves the market we've got the Euro yen Euro yen this week came up into the supply zone and then that supply zone you know pretty much held and then risk off came into the market sold off so this was a great week if you were you know buying the yen and risk off going to the Euro yen do now is just extend that up to here to here and now what we're looking for is price to even move back yeah that's one option you need to either pull back and then a lower low that creating a lower high and then a move back into that zone before getting short and again you really need to look for some risk off sentiment if risk is on I don't think any of these are great to be fair they're not necessarily it's not my favourite pair I'd only really trade this to the downside and risk off knowing that the Euro is the weaker added to potentially going to sell off so any kind of pull backs from a demand perspective we are down into this lower area of demand but I think the next area is going to be from way back here there going to be the two areas if you wanted to put have we cleared it I'll put it there I'll just put it there and yes we've got a close below but let's just say that it hasn't cleared it there would be an opportunity especially if risk comes back on into the market on Monday risk on then I think the Euro will strengthen from now depending on what happens on Monday this trade isn't over it isn't over I'll keep that there and it is a buying opportunity if you want to be a buyer of the Euro moving on to the dollar this week price ended up selling off again you know very strong dollar but also as well Ozzy was getting weaker and this was due to again the risk off sentiment and the Australian dollar doesn't do well on the risk off environment I think the US dollar was going to be the strongest anyway I added to the risk off environment did not help the Australian dollar at all this week so this level now has definitely gone these levels of demand have gone so what I'd have to do is take these out and I think this is definitely due to a pullback but and this is all part of this demand zone here as well I'm going to put it like there I'll put it here as part of that wick of demand so there could be a decent reversal right now that being a little pin bar what else have we got literally we've had 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 bearish closes so the more bearish closes we have consecutively more likely we are to at least pull back at some point so this could be a pullback point and if you do want to be a buyer of the Australian dollar now may not be a bad time I'd be looking for really prices to to create supply zones so that I can short this currency pair so you're waiting for a lower low which creates a lower high and then again a move back into that supply zone and then you've got something like that or what you might have to do is prices could start to make higher highs higher lows and then create a move down and then something like that with price come back up into that area there and then short trades right there but as it stands supply zones until way up here and then finally we've got the Aussie Yen Aussie Yen again if you were looking to sell from last week or the previous week up into here pin bars nice short trades and then we've had risk off price have literally sold off so Aussie Yen at anywhere so again we're just looking at supply zones if we're looking to get short and these are where the supply zones are if we're looking at demand let's see if there's any demand anywhere I think the last real kind of demand zone was way back this was a level that's been touched a few times so where am I going to put this where to put this where there we go from there to there as you can see it's always been touched touched touched touched there we are and now we're into that larger area of of demand so pretty much I think we wanted to potentially make this bit more accurate then what we want to do is we've got a bit of support within that demand zone so I think 72 round number is going to be where there could be demand or even like I said it's coming into Sunday open Monday if everything is okay the Trump trade fears have gone away then this looks like a very very good buy extremely good buy for the Australian dollar I do like that and again the same thing as the Aussie dollar where you're ever going to see if you want to get short either lower highs lower lows or if prices create some sort of supply zone and then you're waiting for a price to do something like that where you're kind of getting that supply zone there otherwise you're looking at a move all the way up here before you get short at that area right there so that's it for this week hope you've enjoyed it please don't forget to like, subscribe, share if you like the content leave a comment and I'll get back to all of you who have left a comment as soon as possible there's been some great questions and I've been busy I've been quite busy for the past few weeks matter of fact and I definitely will get back to every single comment at some point so it might be delayed but I'll get back to you anyways guys take care and have a great trading week and speak to you soon