 Hi, my name's Leon Roeb, currency trader and trading coach at Trading180.com and welcome to this week's fundamental and technical supply and demand for its and gold analysis. And if you're new, I want to welcome to you. And if you're returning an equally one, welcome to you. And I hope you all had a great new year's break and ready for 2024. And markets are back. So looking at the week ahead, starting the eighth of January in the United States, the main focus will be on a December inflation rates followed by foreign trade and producer prices and speeches by Fed officials. The inflation rate is really going to be the main data point that it's going to be focused on because that will really kind of determine when the Federal Reserve are likely to cut interest rates, whether March or some analysts a lot of analysts are thinking now that the markets got ahead of itself and that they could start to cut in May at the earliest. Also, Switzerland and Australia will unveil this their CPI figures. It will be a busy week in China where the calendar includes consumer and producer inflation and foreign trade data. Germany will share insights into factory orders, industrial production and export and imports. The United Kingdom will showcase November's GDP report and growth and industrial production figures. And lastly, investors will keep an eye on unemployment rates in the Euro area. So that's what we've got coming up this week. And so getting into some of the technicals and some more fundamentals and looking at the dollar index and the dollar index, just a measure of the dollar strength against the basket of currencies like the Euro, the yen and the pound. So looking at where we are on the daily. And we had some news on Friday, which was non-farm payrolls. And so let me just move this slightly over. And yeah, so when it comes to non-farm payrolls and unemployment as well as wage growth, there were some good numbers. So the US jobs report suggests no pressing need for the Fed to cut rates. And so it's important to understand that the likelihood or the closer the Fed or any central bank is to cutting rates is the more the currency will weaken. So it's really about central banks on the leading and lagging end of their interest rate cutting cycle. And on the top right hand side, you can click on the video and I really kind of go over and explain really the strategy, the fundamental strategy of Brown leading and lagging interest rates. And so the good report from the US pretty much the market is now pricing out rate cuts in as soon as March. So solid employment gains, low unemployment and sticky wages suggest no imminent need for federal reserve rate cuts. Nonetheless, the jobs market is cooling and the concentration of employment gains in sectors viewed historically as being lower paid and more part time raises some concerns. So it's not necessarily all, you know, a bit of roses. So we think the Fed will wait until May before cutting rates. And so that if that is true in the market consensus, you know, does think the same thing, then you're likely to see the dollar actually continue to be supported. So there could be a pullback this week. And if there is a pullback this week, I personally am looking at some buy trades. And so on the dollar index, and not necessarily trading the dollar index, just looking at this as in terms of overall dollar value. So if we understand that this is an expensive area up at these highs, and this was the most recent low, yeah, then we are at highs, which is more of the expensive areas. So what I'm looking for is either a pullback into at least the daily demand zone for some confluence or looking for if prices continue to move higher, yeah, then waiting for a pullback into what would be a created new demand zone, which is good, which would be right here, and then look for a buy trade to buy the dollar against what I would consider a weaker currency. So that's where we are right now. In terms of some also some confluence within this area, you also got a level of support and resistance that has also it's also being traded. So it's a really nice level, but from a decision, you know, where we're going from here in the short term, nobody really knows. But you have a plan for, you know, any eventuality, but the key is really understanding where the fundamentals are taking you. So if you understand that prices are coming down, but you think that the dollar is still a buy, then you're looking to buy for cheap, right? That's really how it works. So try and avoid buying the expensive levels or at highs, right, or selling at lows or shorting at low. So that's where we are with the with the dollar. Also as well, one of the things to kind of look out for is red sea attacks bring risk of higher prices for Americans, Biden officials warned. So you've got inflation remains political ability for Biden, reelection bid, and officials say that say they see little impact on energy prices so far. So with the with the, you know, issues surrounding, you know, the red sea, your, you know, and attacks on the ships that is potentially raising costs for the shippers. And so you're going, you know, we could likely see inflation rise as certain costs are passed on to, you know, the consumer, right? And so that is something to kind of keep an eye on in terms of inflation numbers. So let's see what happens there. So moving on to the the dollar yen and the dollar yen again, this week, we did have prices kind of come up to this supply zone. Now again, if you're looking to buy the yen, then this would be a decent area to look to buy again. Now I do think the yen is a buy in 2023. But currently, there seems to be a bit of a pullback in terms of the expectation for when the Bank of Japan is looking to hike rates. And so there was some talk about the Bank of Japan potentially looking to hike or implement some policies like yield curve control and ending yield curve control, which would likely strengthen the currency. But that is probably being taken off the table now, due to the recent earthquake as well in Japan. So it says here more Bank of Japan watches shift hike forecast seeing January unlikely. So more Bank of Japan watches joined those pushing back their predictions for the end of negative rates in the wake of the New Year's Day earthquake and recent remarks by Governor Kazuo Ueda. And so you don't necessarily want to hike rates when you've just had a bit of an economic disaster. So also as well, the economy isn't doing fantastic. So I do think that although they are looking to hike rates, it's just a matter of when and the timing. So most analysts expect April at the absolute earliest. So I think for now, there is scope for the Bank of Japan to potentially weaken a bit further. But I think going into the second quarter or at least going at the end of this first quarter, going into maybe February, we should see the yen look to strengthen a bit more as we get more data. And I guess a closer decision as to whether the Bank of Japan will hike rates or not. And the Bank of Japan are really the only central bank that has seen hiking rates out of the currencies that we trade. So I do think the dollar is looking like a potential buy anyway. And so against the yen at the moment, I think the timing might be a bit difficult to kind of sell the dollar and buy the yen. I think my more high probability of trade would be if prices do come down to any demand zone and they're looking for buys here. If you are looking for shorts, then I think anywhere in this zone is okay. Probably a bit further up might be a bit more advantageous. You've probably got something like this zone here to look for in terms of trade to the short side also from a support and resistance perspective. You also have this area here where you know basically it's been traded as a resistance, a bit of resistance there, support, support, a bit of resistance. So there's a decent area right in that 14750s area to look for some short trades if this supply zone doesn't work out. And again, it's really about understanding the impact of rate cuts and hikes on currency and I think medium to long term I would be bearish on this currency but I think in the short term the next maybe month or so this is more a bit more of a difficult buy in terms of buying a Japanese yen against the US dollar for now. Moving on to the dollar CAD and so the Canadian dollar did have some news as well on Friday. There was some mixed news which wasn't necessarily great for the Canadian dollar and so for me looking at this pair I would still have the bias of actually looking to buy on pullbacks and so in fact I would say this is hidden demand and so you've got more of a pullback I think if prices can do that then that I think is going to be a great buy. If you're looking at again buyers on the dollar, you'll be looking for pullbacks or you're looking for a move higher to prove that there is some demand there, proof of value and then a pullback into what would be a demand zone there before looking at getting long. If you are looking for short trades and think that the Canadian dollar are looking to strengthen over the US dollar then you're looking at short probably right now. Now in the private mentoring group we looked at the probabilities of a rate cut from the Canadian Bank of Canada and it looks like there's an 81% chance of a rate cut currently by the Bank of Japan in March whereas the US I think it's a lot less so let's go to the US I think in March it looks like a 66% chance of an ease so March is data and whereas for the Canadian dollar the market is pricing in an 81% chance and so just looking at that data alone you would think that the dollar really should be the trade the currency to buy so of course data can change and depends on what happens with the economy and inflation but as long as the data supports the narrative my bias would be more to buy the dollar CAD than then short so that's where we are with that looking at the pound dollar and the pound dollar the pound has been a bit of a mixed bag and before we get into the the pound dollar I just want to remind everybody that on Monday the 8th I am opening up and reopening the the Trading 180 Mentoring so if you do want to join and really apply these fundamental strategies to your technical analysis strategies then I will be opening mentoring for about a week so from maybe the 8th of January until maybe the 10th or the 11th of January and then I'll be closed again for the foreseeable future and so in Trading 180 we do have a mixture of fundamental our approach is really applying fundamental analysis looking at inflation interest rates business cycle monarchy policies and risk sentiment and applying that with technical analysis so we fit right in the middle so if you are interested in getting mentoring for myself from really understanding fundamentals to a very high level and joining the discord group and we have a great bunch of traders who are really killing it at the moment and so this is you know some of the data and the analysis that we were doing on Friday plenty of conversations plenty of analysis going on and so you're not going to be you know alone all the traders in here very friendly very supportive and you also get access to the members trading videos and you can see here we I do record members videos that are not released to the to the YouTubes and so lots and lots of videos in here in fact hundreds you've got years worth of videos in here I could keep going back forever there's probably thousands of videos on this playlist and that you can go back and check out and all you know from trade setups to fundamental analysis you know everything I know is in you know pretty much in this in these channels so if you do want access to it go to the Trading 180 website and check that out and it'll be open for a limited time only so going back to the pound dollar and looking at the the where we are in terms of technicals so you've got really this this area here where you've got higher highs being made right so you've got high low and then you've got a high so prices putting back to this higher low is where really the strongest area of demand should be the first area that you want to look towards so you can see where prices did bounce off of that demand zone around now on the daily right and then you've got a second one right here as well so yeah that's if you're looking to buy the the the pound for me though I'm not really looking to buy the pound I think the dollar hopefully according to the data should be the the trade but let's see what happens this week as we do have the GDP month for month you know for the for the pound and if that does come out as expected it says forecasted previous was minus 0.3 and if it comes out anywhere you know at the 0.2 or above and in fact I think the pound may start to rally but anything below that then I think the the pound may start to actually fall against the dollar and again from a looking at Bloomberg the UK Economist upgrade outlook with Bank of England seeing cutting rates in May so Goldman and Bloomberg Economist predicts stronger 2024 growth and improve prospects in second half set second half set stage for UK elections so in fact the Goldman Sachs and Bloomberg actually think that the UK economy could start to grow whereas I think a lot of other economists think that the Bank of England could start to cut a bit sooner so again some mixed signals going on there so when you have mixed signals typically prices end up in what is known as a range or an auction sideways moving market not necessarily the clearest pair to trade at the moment but if you are looking at buying the the dollar against the pounds then I think any moves around these are one two weight round numbers going to be nice but if you are looking to buy the the pound any pullbacks into a demand zone or lower should be a decent move to the to the upside but I think that all kind of depends this week upon not only the GDP month for month but also as well you've got core inflation data as well I mean if core inflation remains sticky for the dollar then in fact I think the dollar could start to strengthen even more simply because it pushes back expectations for rate cuts in in March so that's where we are with the pound dollar looking at the pound yen and again the decision week really is going to be you know not only from a yen perspective consumer confidence and I think consumer confidence is going to be you know any kind of market mover but it's more the market is probably looking more towards GDP month for month for the UK so it's at a really nice level but this level has been touched several times and more times level as touched the weaker it becomes and so there could be the opportunity for a bit of a stop on above that level and again if that coincides maybe with some some disappointing data for the UK then in fact that's going to be a really nice technical trade from a buying perspective if you are looking to buy the the pounds so this trade was basically if you're buying the yen right if you're buying the yen you're shorting if you're buying the pound then you're looking at any kind of moves all the way back down to this so 17950 area to look for any kind of buy trades so moving on to the the euro dollar and the euro dollar although again we had some decent news for the the dollar prices were you know kind of just created this indecision candle with doji candle I think the market is now probably looking more towards the core inflation data to be sure as to whether prices are looking to either you know move to the downside in terms of dollar strength or in fact dollar weakness back up to maybe these these recent highs and so for me I am actually in a short trade from all the way up at these highs and so I'll talk about that probably after the video and yeah let's see what happens but technically right we've got that as a demand zone and then we've got this as a supply right up here the euro at the moment I just don't I can't see myself being a buyer of the euro at the moment although there was some inflation news that you know was seen to be positive in terms of rate cuts and euro every inflation picks up again as energy aid is removed and it says here that ECB expects price gains to slow more gradually this year and so inflation did pick up a little bit which you know you would expect the ECB to probably start to you know hold for longer but it says here that investors have nevertheless piled into bets that the ECB will start lowering interest rates sooner than mid 2024 a point some of you should have identified as the earliest possibility so I believe that the the ECB are likely to end up cutting rates probably at least around the same time as the Fed that's what I would expect and if the Fed do cut before the the euro I'd be quite surprised but then you do have the election cycle for the dollar so you know that's really going to be a catalyst for for rate cuts but let's see what happens I think in the short term the dollar still is the the ultimate buy so I think any pullbacks of definitely buying opportunities of course it depends on the the data supporting that narrative but if you do want to be a buyer of the euro I think now is a decent time to look for buy trades if you are looking at sell trades on the euro dollar then any pullbacks into this area is going to be decent for a short trade looking now at the the euro yen and the euro yen I think is a sell and so looking at where we are in terms of supply and demand you've got these areas here as far as buys but um saying to the guys in the group that might look to enter into this this trade the only thing I don't like at the moment is that it's just that the the yen might be just a little bit weak fundamentally but I think it's a decent trade technically to look for a a short trade of course isn't financial advice but I think that in terms of risk of war this is really really nice and let's see what happens there if not then the next area to look for you know short trades if that trade doesn't work out there's going to be really up at these highs in terms of daily supply and demand zones also as well just as a bit of confidence you do have this area here as a level of support and resistance so you know the institutions have been definitely trading this level yeah level resistance resistance bit of support and stop hunting up above these highs and again you can start to see that's where business has been done so very interested in this area for a short if I'm going to buy the yen it's going to be against the euro so again let's see what happens there you've got the euro pound and the pound doesn't look like it should be the the stronger out of the two as they are expected to hike later than the then the ECB and so in terms of directional bias I would likely go for any you know short trades that'd be my my bias to buy the the pound so although we do have in fact a some supply here I think the best area to look for any kind of short trades in terms of buying the pound will be up at this area here if there is a reversal of fortunes then in fact there is some demand that kind of starts around here where we are and when you get quite a wide zone of of demand it's good to look for you know areas of support and resistance whether that be you know horizontal or diagonal and you can see here probably around here that there is a level of probably around that brings down a bit yeah you can see where there's a bit of support and resistance with prices on the daily you know hit that level there and then it's been resistance resistance then support so potentially you could see prices now start to bounce off of that area or at least down at these lows so as if you want to be a buyer of the euro against the pound but I personally wouldn't look for that direction I'm looking for for the other way so buying the pound against the euro but again it does depend upon what happens this week now the euro again has a balance of trade and then there is also inflation as well so let's see what happens with that looking now at the Australian dollar US dollar and I think Australian dollar is probably one of the strongest currencies currently they also have some data coming out which is CPI but it also it's not necessarily showing on the on trading view at the moment it's just this balance of trade but I think if CPI remains sticky for Australia then you should get in fact I think a move higher simply because the central bank are likely to high crates if we get CPI comes in lower then you're likely to see something like this but again I think that this in terms of directional bias we'll have to wait for the data to come out and then look for any kind of buyers buy or sell trades but if I'm buying Australian dollar it wouldn't necessarily be against the US dollar at the moment because I do think the US dollar is probably likely to appreciate at least in the short term but into the second half of the year or at least towards the end of the first half of the year I think I'll be looking for more dollar shorts and US dollar shorts and more Australian dollar buyers and going into gold gold again I think this year should be gold's year if the pretty much the economy is going into in the world global economy is going into a recession right so you've got you know the UK heading into a recession potential Europe the US you know talking about you know the soft landing but could be bumpy in terms of you know their economy then and with all central banks looking to cut rates I do think that gold should be you know a buy ultimately so whether prices you know come down to you know where we are now and that could be a decent area to look for buy trades or if we're looking further out and maybe prices come back down to the 1970s down to maybe the 1930s I think that's going to be a very nice price to look for buying gold so but with dollar strength at the moment or the potential for dollar strength over the next you know couple of weeks I think gold's going to be probably a tougher buy right of quite a tough buy so let's see what happens with with gold trading gold at the moment but in terms of investing then any pullbacks are really nice buys so yeah that's it for this week in terms of the analysis and let's get into the euro dollar trade that I took over the holiday break so this is a trade breakdown on the euro dollar and I took this on the 28th of December during the the holiday season and so in fact that should be a supply and not demand so yep the reason why I took it was that we had some confluences some of the confluences were pretty much that you had a supply zone there also had to a level would the key level of resistance here and the fact that you know it's been traded here banks were doing a lot of business in this area had been historically doing a lot of business in this area you can pull this back even more you can see that yep historically banks tend to buy and sell in this zone so looking at that brilliant zone supply zone support and resistance and so when prices came up to here again we're not just looking to you know willy-nilly start trading this in terms of just placing and pending orders I'm looking for you know some some candlestick entries so you know going down to like the lower time frames and then I saw an entry at this area here it was the 107 one so 11073 area so this and the close of that candle I entered and then also as well I had about 20 pips stop something about that above the level and then it was literally that that was it right now many of the guys in the discord group also know that I enter multiple positions if the market gives me the opportunity to and so what I did was I entered in a 50% retracement now I'm not guaranteed to get the 50% retracement but what I did is I set a pending order so it allows me to you know get a better price if price is pulled back right so from that perspective that's what happened and I was you know fortunate enough on this trade to be able to get a better price yeah so that was really what I was looking for and prices managed to come back to that area there so so yeah that was that and then you have you know 0.1 percent you know 0.2 percent on that and then 0.3 percent on the 50 the 100 percent retracement right so if prices actually pulled back to 100 percent I'm entering at 0.3 now on this one prices only managed to trigger me into two positions and so you know that one there now becomes a one-to-one but because I've entered at 0.2 percent now becomes a profitable trade right so there we are that's where we are and so that hit a one-to-one 0.2 percent now I'm just trading this 0.1 percent you know as far as I can take it and I've also as well moved my stop down to um to wait wait below break even now I think I stopped this somewhere around uh this around the 110 40s 45 areas so um this has now been a profitable trade pulled back a little bit but now we've got multiples of uh of R and I'm hoping to trade this actually down to the 108 20s or is it the 30s yeah just above here so the one 108 30 would be the area that I'm looking to take the trade so that would probably end up being something like a one seconds something like a 2.84 to one on one of them and also as well I've just banked a one-to-one on that so I can't lose on this trade even if this pulls back um I've made 0.2 percent on one of my trades and I just lose basically nothing because I moved my stop down but if I didn't move my stop down and kept it where it was and I lost on my second trade then I would still be up on this trade so profitable trade and the reason why I do that is because it makes it easier uh psychologically to hold trades and so knowing that I can't lose and in fact I'm up so I don't necessarily need to grab or snatch it at trades and I think one of the worst things you can do as a trader is only enter into one position and try to manage that one position if you can get in on you know two or three uh trades and it's like I said the way that I enter sometimes the market doesn't give you that and you don't necessarily have to enter um just one position at market and then one position there you can enter two positions here right but either way you enter if you can enter multiple positions and then try and take profit at least and get yourself to break even to some degree then it does make your trading psychology a lot easier when holding trades knowing that you're at break even and all you have to do is basically hold a trade until you know your profit target right wherever that might be so yep that's the uh the trade breakdown so far I'm in this and again my stop loss is actually below my entry point and so um again I can't lose I'm always I'm up on this trade and let's see if it actually rolls over so yeah that's it um I was in the uh a pound dollar trade and that trade ended up being um a small win as well so let's see what happens I might depending on what happens this week as well uh the fundamentals go in my favor in terms of the uh the dollar um core inflation uh ends up being sticky or um or comes in higher than extend forecasted then I'll hold if it comes in you know maybe as is or lower then I might consider just taking the rest of my profit off and then move on to the next trade because I don't think the dollar may continue to move lower but let's see what happens but that's really the trade breakdown and uh yeah guys that's it so I hope you have a great trading week and I will see you in the next video take care