 Hi, my name's Leon Roe currency trader and trading coach at trading 180.com and welcome to this week's fundamental and technical supply and demand forex and gold Analysis if you're new or welcome to you And if you're returning an equally warm welcome to you and if you like the videos that I provide every weekend Please don't forget to like subscribe and share with your fellow trading colleagues Definitely help support the channel a free way to support the channel and so getting into The week ahead you can find this analysis on Trading economics comm if you click on there go to their main site trading economics comm and then go to the week ahead tab you'll see Their analysis on what is coming up? Next week and so let me just zoom in a little bit in the week ahead in the US The spotlight will be taken by ISM non-manufacturing PMI the University of Michigan's consumer sentiment and PPI data so that's more driven by and and I guess an early indication of Of the economy as well as inflation data So investors will also follow interest rate decisions in Australia. Yes a lot of central banks coming out with their decisions of Australia Canada and Inflation rates from China, Brazil, Turkey, Russia, Philippines And then finally we've got German factory orders and trade data from China, Canada and the US should provide some insides into insides insides I guess into the state of the of global demand and this month not necessarily this week But this month we've got a lot of central bank Announcements not you know this week is is going to be Australia and Canada, but we've got pretty much, you know The Bank of England I think the ECB Federal Reserve I mean coming all coming up this month as well So it's going to be a busy month in the next maybe definitely two weeks up until maybe, you know Just before Christmas and then things will probably quiet and also probably they will quiet and down for the Christmas period and then back to the new year anyways Trading economics have a really detailed Description as to you know what to look for so click on the On the week ahead tab and you can have a read of all of that and what is to be expected So I'm going to get into the charts and just some of my my bias and my analysis going forward And if you haven't watched it already I released a video this week or two videos this week Called the forex price action crystal ball versus forex fundamental analysis part one and there is a part two that I've released and in this analysis I pretty much spell out and go over and this was From a private Members discord group called I hold on Wednesdays and this was on the 19th of October And also as well. I'd basically said this Mumps in advance as well. They're about two or three other Private members calls which basically was talking about this exact analysis and this coming and so If you watch this You and part one and part two what you'll be able to You know gather from that was that this move to the downside was expected and it was coming So think about you know Wednesday the 19th, right, which was this day right here 19th of October 2022 is when I had the call and again. I've been saying it's probably from for more because September times, but This is just one of the ones that I've released And you'll see that there was a reason why prices have you know pulled back now Let's not confuse this with a reversal and many traders would Confuse with a reversal in you know a dollar trend, right? This is not dollar trend and the reason why I've zoomed out is because if you look at the year to date Yeah, meaning the 2022 lows to the 2022 highs So this was an absolute bargain price for the dollar and this has been obviously an expensive price for the dollar Yeah, between the bargain or a cheap price an expensive price is what's known as fair value and Everything price typically reverts back to the mean right reversion to the mean which basically the mean being Being an average and average being in terms of the the narrative of of expensive and And bargain prices and looking at value. This is fair value Yeah, so it's not as really a surprise as to why the dollar has kind of pulled back especially after this, you know It's major Trending it's really been driven by and I'm not gonna give away You know the the whole video or anything like that, but it's been driven by a shift I guess or the potential shift in You know monetary policy and many traders would say fundamentals don't work what they do, right? Just not in the way that you know is taught online But you know pretty much forecasted this to happen and although every week I literally continue to say that I'm still long is because I Tend to I want to be a bargain hunter I'm not really trading just to trade and go short and try and go long on the currency unless there is a sustained Or I believe it's gonna be a sustained trend and I don't think I just think this is a pullback to you know Cheaper areas and bargain prices and what we've seen as well is the potential for a Floor or or the dollar to have a fortune in reversals because of what happened yesterday Why say yesterday, but on Friday With regards to The data and jobs data right so non-farms US hiring and wages extends strong gains keeping pressure on the Fed payrolls rose 263,000 in November above all but one estimate and the average hourly earnings, which is Inflation related jumped to zero point six the most in nearly a year and so That keeps pressure on the Fed and so the US employment added more jobs than forecaster, which is good Say good, but whether it's good or bad But in terms of it putting you know pressure on you know The Fed to try to continue to appreciate the currency And continue with their monetary policy and if you're long dollars then that would be a good thing, right? So anyways forecast on wages Surged by the most in nearly a year pointing to enduring inflation pressures that boost chances of higher interest rates from the Federal Reserve and so, you know That's the analysis also as well Larry Summers Says Fed will need to boost rates more than markets expect so former Treasury chief Warns of a high interest rate recession and Summers says economy could slide suddenly like avalanche and that doesn't sound Great, but it says he says that we have a long way to get inflation down to the Fed's target Summers told Bloomberg television wall Street week with David West and actually watch that as well as For Fed policy makers, I suspect they're going to need more increases in interest rates Then the market is now judging or that they're now saying and I know obviously Larry Summers is an Extraordinary chief is a very smart man very experienced and so Not to say that he can't be wrong But you know when certain people talk, you know, you have to kind of you have to listen, right? and so You know putting that all into context and understanding a pullback Does not make a change in the trend When we're back down to you know fair value I think again the dollar being you know a potential buy technically at these areas Of course, nobody knows 105 was seen as a bit of a potential for a target I did say that there's a possibility for it to come down to the 104s, of course And even the 103s, right and that would be decent and I think that now that the dollar has You know inflation pressures haven't necessarily subsided As well as the economy Still being able to support great hikes in terms of jobs and employment I do think that I'm not saying that the dollar is going to reverse, you know thousands of pips Nobody knows that right but in terms of understanding Value in comparison right to other currencies I think the dollar is again is again, you know one of the better-off Currencies and price and value are two different things right price can You know doesn't always reflect value and and so the the lower this goes I think the more it becomes obviously a bargain anything below fair value Starts to become cheaper and so the market is always looking for bargains And draws traders into going, you know the other way This was known as also as well the pain trade right pain trade and Mrs. Driven by things like short squeezes end of month flows which we cover in our private members group and And so You know, but for me my bias is still always long dollars even in the face of a pullback because ultimately You know, I'm looking to buy for for cheap. So for me dollar index This is just coincides with any kind of dollar buying on other currencies and I do think zooming in we should want to see at least a bit of a a Bit of a pullback to the upside as long as again the data supports the narrative The data always has to support narrative and at the moment there is positive sentiment Especially I think this might have fallen a bit more had inflation had gone to the downside But and jobs have been weaker, but obviously it hasn't so I think over the medium to About medium term I would say for now at least we should we should in a word, you know, possibly and could it's not definite Right because it's not a competitive future. But you know would the probabilities would say that the dollars should be a buy at some point And again, this isn't financial advice either one of the things that is going to stand in the way of Of potential for a dollar reversal as well is China's Economists calling for easing of coat of COVID curbs to boost growth. And so if There is a reopening of the Chinese economy that would trigger more risk or on sentiment And then the dollar in fact won't necessarily benefit or won't benefit in at least a short to medium term because money they would then tend to come out of the dollar and into Currencies commodity currencies like for example, the Australian dollar the New Zealand dollar because China is really the world's economic engine and You know, there are growth opportunities that money will flow into and out of and so I think the money There will be, you know portfolios being readjusted out of the dollar as well and into other Growth Currencies and commodity currencies and so that is another thing that could keep the dollar on the defensive if that you know You see the dollar start coming down And that story is gaining traction then that can also push the dollar to the downside But my bias personally is still to the upside and so yeah, I think the dollar is A buy again, you can also sell if you want to sell if you're looking for any kind of short trades and you're you know looking for You know, you don't agree necessarily agree with me That's fine. You don't have to agree and if you want to you know look for Sell confluences then you're looking for the 106 price to come up to the 106 Area at the moment and then looking for short trades again, not necessarily no dollar index, but you would look for it on Confluence with for example, the dollar yen dollar Swiss dollar CAD etc Looking at the dollar yen and the dollar yen has pulled back again going back up to the year to date If we look at the year to date price action and we see this massive trend, right? Which was all predictable all predictable and predicted and in fact that just reminds me of The fact that you guys did not complete the target right anyone watching I had a 10% 10% likes target on my videos and if I get 10% like One out of ten of you like My video my weekly videos and over a thousand views and I would release a webinar that I Recorded on the 3rd of November forecasting forex trends that lasted for months and the guys in the group in fact And I've all the evidence of this We're aware of my forecast for the dollar yen making this type of move to the upside and And So I can show you how to do it But and I recorded the webinar showing you guys what you need to know But I just needed you guys to comply and you know one in one in ten of you Just basically like the video just press like but unfortunately we fell short of the target So I can't release the the video until I do And until I do then until you guys, you know one in ten of you like my YouTube video Weekly video then Unfortunately, I'm not gonna be releasing this until maybe next year and even then I might not even release it It might just be for those who actually turned up for the webinar who got the information and benefited from it So all you got to do is just make sure that I get over a thousand views and One in ten of you like this video and my weekly Analysis videos and once I get that, you know within seven days and then I will release the webinar Believe me. It's a webinar. They really kind of cuts out a lot of the nonsense. It's what you really need to know in terms of Fundamentals analysis and forecasting trends that last for months. Anyways Getting back to the dollar yen again just looking at the yearly lows yearly highs We're really just putting back to again fair value fair value does not mean that we are you know The trend has ended it might be a short-term pullback and I get the size of the move to the downside looks like lower highs and lower lows It's making, you know a new trend but zoom out always zoom out when you see the fact that it's not You know, it's just putting back to you know a decent demand zone Then you know puts things into perspective So I think we are at the the lows or somewhere near these lows where you want to probably now It looks as potentially start to buy the the dollar over the end the Bank of Japan at the only bank bank that are not hiking rates Still so Ultimately, I think the dollar is still a buy over the yen. You do have some supply Right here in case you do want to look for you know pullbacks to look for sell trades So those two zones would be the immediate zones that you would look towards if you do get a pullback And you want to be a buyer of the yen then you're looking at the one three eight six three levels But for me my bias would be to the upside Especially after the good news In terms of I say good news, but you know the positive news Out of the fact that we've got us inflation You know still a potential problem wage growth as well as You know jobs supporting the economy so anything down into the one three three Fifty's down to the one three fifties. I think there's a decent buying opportunity Dollar Swiss again zooming out year to date low to the high actually this is The dollar hasn't really benefited at all against the Against the the Swiss Frank this year and we are again at a cheap quite bargain area So I think have you broken through that demand zone yet? Well, I'll keep it there for now because it's still a tradeable opportunity So from a demand perspective you do have a demand zone here and you got another one There and then you've got these ones all the way down here So these are the zones that you daily zones that you're looking for anyway If you're looking for a buy trade if you're looking for sell trades Then I would probably say you're looking at all of this as a you know your first so that you look for Potential supply the next supply zone up from that is here, which is hidden supply and you're looking at those zones here on the For the dollar Swiss and so again a nice reversal in fortunes for the dollar price You know should potentially move this higher at some point again You go lower before it goes higher. Who knows but um, I think the dollar buyers I think again, we've we've seen maybe the Temporary floor in the dollar weakness and dollar weakness and devaluation Dollar CAD year to date as we're going to end of the year get lows to the highs and Looking at the arts all again Canadian dollars been a bit weak this this I'm against the against the dollar If you're looking to buy trades, then you're looking ultimately at demand around here Supply your nearest supply zone, I'm gonna put it up here because I do think that although we've pulled back a little bit into Into You know here I don't think it's enough for me to want to draw that as a zone So I think if anything you want to be a buyer with a dollar against the Canadian dollar I think that's decent and if you want to be a buyer against the By the Canadian or against the dollar, I think the highs are going to be the one three nine It's going to be the best opportunity to look for Buy trades on the Canadian dollar New Zealand dollar US dollar just been going from strength to strength from it coming up to quite a decent area of supply here if you want to be a buyer of the US dollar, of course Not quite there yet, but I think that opportunity technically is actually really nice and The the New Zealand dollar and the RBNZ their central bank haven't You know I've kind of bucked the trend in terms of hiking more than expected They hiked by 75 basis points rather than their expected 50 basis points Which is keeping New Zealand dollar actually quite One of the factors keeping the New Zealand dollar quite quite strong also as well there has been the potential for China reopening which Would benefit the New Zealand dollar and so any pullbacks into you know any kind of demands only if you're looking to trade that against the The US dollar would be a buy if you're looking at you know potential risk off continuing and really kind of a ceiling to the To the New Zealand dollars Appreciation then I think this supplies only going to be really nice for a for a decent sell and We've had this you know It's kind of move which is kind of gone straight up with no real major pullbacks And so ultimately you will get a pullback at some point in the same way that you had a nice move all the way down With no pullback this was the pullback and then you've got the same thing going on this side of things So I think prices should pull back at least to again a decent area possibly around the 60 60s to 5 9s somewhere around me be here But again, not really a pair that I'm interested in trading at the moment Pound dollar right got ended up getting stopped out of this trade But I'm I've actually re-entered back in on this and so the pound is is is Baffling everybody really when you think about it from a from an investment perspective And it's bad that the dollar might seem I can't see it being worse than the Than the dollar and I think this is just one of those short squeezes that have lasted for a while because When you look at for example Britain, you know is near the bottom of the heap for economic growth potential You know former Bank of England official says did explains high UK tax burden burden Labor shortages behind steep collapse of growth speed limit and so, you know Britain's growth potential has fallen behind every large economy except Mexico due to collapsing Productivity and severe labor market shortages according to former Bank of England racer Michael Saunders. So You know, this is like it's like you you look You know the pound and you look at, you know the performance of the pound You would think that the pound would be You know a a buyer right in terms of a value, but I think this is highly overvalued or expensive for the For the pound just like I said from a fundamental perspective. Yes, you know things keep going higher But for me the downside potential for the pound You know, there's still targets of the pound reaching at least one 110 and even it even like as far as the one 14. So even if it comes down to the one 14's And this is where the demand zone would be You still have at least about a 900 pit moves to the downside. So I don't mind losing a few a Couple of trades here and there if it means that my risk reward potential to the downside if it reaches there It's going to be at least 10 11 12 to 1. So I'm backing on this Let's see, you know, if it can finally roll over towards the end of the month now that we've got some decent news on the on on the on the dollar Let's see if that rolls over for me. I can't really see, you know, myself buying the pound Fundamentally, it's really just not a like I said, you've just seen, you know The fact that what they're projecting for the for the for the pound and I think it is one of the worst Currencies again, the move has been a bit more of a surprise in terms of, you know It not rolling over just yet But what that does is that just creates more liquidity to the upside allows the Institutions to buy for cheaper and then because they actually plan their trades out for, you know Mumps in advance allows them to get in for cheaper and then I think it's going to roll over at some point So, yeah, that's really the pound euro dollar. I'm in this trade as well Looking for more downside We are up coming up into this area here In this supply zone I'm actually in from I think it was a weekly zone I ended up getting it on and so let's see what happens if it rolls over again around here for now for this daily Analysis, you know, you're looking at just slightly higher and then to the downside I think that would be decent for a potential short trade again. I think the 105 50s 106 is is is very very very cheap again. This could be There could be a reversal in fortunes fundamentally for the euro and that would drive the euro higher But at the moment it's difficult to see if you are looking to be a buyer of the euro Then you've got these areas right here for demand first demand zones One and two Again, my bias is for It's for dollar downside again, there's lots of bank analysis, you know calling for at least Prices to come down to Round around here by the end of the year we're into the into, you know, 2020 threes So there's still a good, you know, at least about 500 pips in order to to to get on on this On this this trade euro fundamentals talks about ECB Gwendoz sees inflation at current levels for three or four months So European Central Bank Vice President Louis D. Gwendoz Expects euro area inflation to stay at current levels for a few more months So inflation may be free for months at these levels, but we will have a clear slowdown in the first quarter of 2023 He said in Madrid on Friday, we see that inflation is beginning to slow down But it it has to be stable continuous over time. We have an M shape evolution and so You know inflation around the world. Hopefully is coming down So, you know, we've when we always kind of focus on the US dollar and the Fed but And you know the impact of inflation coming down and what that has on dollar but the same thing is gonna happen to Did the Europe as well as you know, the UK and other central banks across the world because as they say a rising tide Tide lifts all boats, right and if that happens then obviously if the tide goes out Then it's gonna lower all boats and so You know the dollar isn't exclusive, you know to the the effects and the dollar evaluation isn't exclusive to the effects of What the central bank does so if if inflation coming down is affecting the dollar And devaluing the dollar then it's gonna happen the same thing is gonna happen to Europe and the same thing It's gonna happen to every other central bank. So So for me if that's dust off to come down and they Surprise because the expectation as well is 75 basis points Sorry, I don't know why I did that 75 basis points was the was the expectation for the hike But if they don't hike by 75 basis points, they have by 50 then basis points then Then the market has to revalue the the the euro At 50 basis points and that will bring the euro to the downside, right? We should do anyway. And so let's see what happens there Aussie dollar again benefiting from Dollar dollar weakness, but again if we look at the overall year to date from low Or from high to low Yeah, and you know, you'll see that we haven't even really pulled back to fair value yet So though, yes, we're seeing a bit of a pullback, you know You know, there's still some some areas that needs to be taken out in order for this to kind of be determined from a you Know a trending perspective, right? or reversal in trends and so for me, I think the You've got a supply zone there not really a pair that I'm interested in trading to be fair Only to the long side once risk on starts to come and if risk on starts to come then I'm you know I think it's gonna be probably one of all the Australian dollars gonna be one of my My immediate buys from a demand from a from a currency and a risk-on perspective Not necessarily against the US dollar But I will look for any pullbacks on Australian pairs and look for a buy opportunities So that's pretty much where you are if you're looking to buy the Australian dollar If you're looking to sell the Australian dollar and buy the US dollar Then we actually come up into a decent zone to look for any kind of short trades. I was a yen Again, I'm the market given mixed messages in terms of risk sentiment because if risk was on Then, you know, you would have you should typically have the Australian dollar going higher if risk was on So the fact that the yen is, you know, still making lows and we're saying it is risk-off, but It's definitely not risk-on. So we've got some demand around here In fact, the whole area. I think I'll just basically just put this this demand zone in Wide area of demand. I do think that The Australian dollar is a buy as long as you know, China starts to reopen So I think anything around 90 areas is going to be a really nice area for and a bargain price for the Australian dollar Again looking at the year-to-date Lows and highs, you know, bargain for the Australian dollar expensive for the Australian dollar Fair value comes in at just below those 90 areas And so that's what I'm looking at where I'm looking to buy the Australian dollar and again Hopefully if risk-on comes in or the Bank of Japan do not Changed their monetary policy because if they thought to change their monetary policy, then I think maybe all bets are off And the yen I think is a buy there is a quite a wide zone of supply right here in terms of the daily and But I think that always the top end of that supply zone should be the one and then you've got Another zone smaller zone here, and then you've got a bigger zone right there So that's where in fact Just seen that it's going to be hidden supplies And in fact it encompasses that whole area there But I think the better area to look for any kind of pullbacks I think if we were looking to buy the yen is going to be at the 96 area that it's going to be where the Fresh air of supply is before looking at getting short and finally gold gold benefiting from the week dollar and I'm actually Not trading gold, but if anyone who's been you know watching my weekly Analysis been saying that gold is a buy as price price has been coming down You know here from an investment perspective and now we've seen prices go to the upside I Think there's probably maybe going to be one more push to the To the downside potentially over the next coming month or two as the dollar potentially starts to strengthen or if it does strengthen then this is what you're going to see and you could see a bit of a pullback and This is backed up by By analysis from HSBC and So They they said gold likely upside in 2023 and mid-dollar weakness and our Expectation for likely dollar weakness in 2023 should be positive for gold while Fed tightening Could still restrain gold at least into the first quarter of 2023 and eventual end to its hike rate hike cycle should aid gold and that's it's really important Because What you've got to Know is that the dollar will be a sell at some point right as it starts to come down in 2023 But it's all about you know the the fact that in 2023 the first quarter will still be supportive of the dollar But as they start to come down on their you know rate hiking cycle You know Then then gold should be a buy so probably as we head into 20 then 2023 And the dollar starts to strengthen and then we get to you know the first quarter of March You know February March would be you know where the first quarter would start to end in the second quarter begins We could see then the dollar start to Weaken and devalue As we get to the end of the cycle and then that would benefit gold is basically what they're saying So over the next few months, you know, can you expect the dollar to go higher? Of course it can go higher But if the dollar strengthening you think the dollars going to strengthen from now Then and you know the correlation between gold and the dollar, you know continues in terms of you know dollar strength and gold You know devaluation then you have to expect another push down another buying opportunity as prices go down For the final, you know buy of maybe 2022 and 2023 and as we start to look at you know Recessions or the avoidance of recession All right because that's gonna come As the world goes into a potential recession Or certain countries at least like you know the UK and Europe for sure Then looking at gold is going to be a nice hedge against You know all of that uncertainty and so I think there might be one more push down for gold The dollar strengthens for the next maybe month or two or three and then as the dollar You know hiking cycle ends gold Definitely being one more buy and so that's the analysis backed up You know when I whenever I do analysis, it's always backed up by by experts and And bank analysis and so for confidence, of course, we're not always gonna be right And we're never always gonna get the timing right But one thing we do more often than not is understand where the trends are and you know forecasting those trends And if we get one of the trends right, which we often do then we can ride it up for you know a decent profit anyways guys Take care. Don't forget to like this video if we do then we can get you know 10% of you like this video After at least I record the next video next week then we can I can release this webinar Which is really gonna help you guys but until that happens. It's gonna be kept in the vault So I hope you all have a great week. Take care guys, and I'll speak to you in the next video