 Hi, my name is Leon Rowe currency trader and trading coach at trading 180.com and welcome to this week's supply and demand Forex and gold fundamental and technical analysis if you're new warm welcome to you And if you're returning an equally warm welcome to you and don't forget to like subscribe and Share this video with your fellow trading colleagues if you find the analysis I provide useful every week so starting off in trading economics in a week ahead 27th February and I guess the summary is Is that in the US this week appearances from several Fed officials will be in the spotlight alongside the ISM PMI's release Elsewhere investors will follow GDP growth figures for mainly Australia, Canada and Switzerland PMI's for China and preliminary inflation data for the eurozone and again, there's more detail with regards to the the releases Below if you want to look for this just go to trading economics calm And it should be in the one of these tabs here by the time you look at it Hopefully it's still there. So the week ahead 27th February click on that and you'll see this news update as to what really the market is It's focused on for the week. Anyways looking at some of the technicals and Fundamentals that happened last week and starting off on the dollar index and the dollar index just to measure with dollar strength against the basket of currencies like the euro the pound in the end and the dollar you know has been a buy and I did Kind of change my bias slightly a couple weeks ago You'll see in last week's video where I was thinking that the dollar is probably a short term buy at least for you know a month or so and It's turned out that be to be, you know, correct And it's really kind of due to the data coming out and supporting the dollar being a buy, right? So What was really the data the data was inflation and so inflation quickens in the US and Europe and Inflation accelerated in the US in Europe last month highlighting sticky price pressures that will keep a central bankers committed to raising interest rates and in raising interest rates typically has the effect of Appreciating a currency because inflation is actually Devaluing a currency right is the devaluation of your currency and so to counter inflation You have to hike or central banks anyway have to hike interest rates and so the US Was did have a bit of disinflation so inflation was coming down But over the past a few weeks There's been supportive evidence that the that inflation Has remained sticky and maybe not as coming down as fast as Was hoped and so what the market has to do now is actually pricing Maybe a couple more rate hikes and if they're pricing in a couple more rate hikes Fundamentally and you see that on the charts You'll see that basically the dollar should go higher right not saying it's gonna go in a straight line No one knows if it's gonna go, you know how it's gonna, you know go higher, but ultimately There's no technical analysis or technical level that's gonna hold in the face of Fundamental analysis and you know investors buying what they think is You know any asset class if it's a buy or selling an asset class if it's a sell Yes, technical analysis is used and we use it of course to time our injuries But ultimately you use fundamental analysis for your overall bias and then wait for pullbacks To buy at bargain prices, right? And so do I expect this supply zone to hold? Possibly could be But I would probably say at least in the short term if I zoom in a bit I think if the dollar pulls back to you know a demand zone any of these demand zones and as long as The market is still pricing in a few more Rate hikes and the data supports that narrative. I think the dollar should be a buy at least for the next You know month or so and again, this is data-dependent right meaning that if data comes out not supporting A rate hike meaning that inflation actually starts to come down and readings You know for inflation where whether it's wage growth PMIs etc Start to actually come down then it lessens the chance of the federal reserve or any central bank Really having to high crates and then the market has to price that in right so as long as inflation is still remaining sticky and high I would Probably my bias is definitely to look to buy the dollar and I did say this actually last week and last week's video So I think for me any pullbacks are going to be decent buying opportunities Not necessarily on a dollar index, but you're looking at You know looking at this as confluence and in any kind of buy areas on any other dollar crosses Would be where you'd look for buys and so moving on to the dollar yen and this area was quite interesting matter of fact it was looking like it was turning into a bit of a stop-hunt, but then with You know inflation PCE coming out for the US higher than expected and also the combination that you had Udia right, I think that's how you pronounce his name Who is the nominated governor now who's taking over I think his name is? Korota in Japan and he basically warns against magic solutions sticks largely to BOJ current script Which is basically Udia backs easing for now as more time needed for price gold to normalize policy Stop massive bond buys once gold is achieved at the Bank of governor nominee Kizuo Udia warned against any magical solution to produce stable inflation and normalize policy as he largely Stuck to the existing central bank script in the first parliamentary hearing to approve his appointment. So It was seen as fairly dovish which basically meant that you know the the market had to kind of pare back its expectation for a Change and a shift in there in their monetary policy for now I think it is definitely coming, but it's just really about the timing of things right and so With you know, you have one central bank who is you know remaining has to get a bit hawkish Due to inflation, but you've got another central bank who are you know maintaining the status quo for now You know, that's the reason why you're seeing prices go higher You know again, I as I say it's not for any other reason other than that anyone tells you any differently They don't know what they're talking about. This is nothing to do with Elliot wave and this is way free or anything like that everything is driven by You know fundamentals and risk sentiment because that's where you you know see value and And so Ultimately, this is where you know prices are going to go at least in the short term And so when you're looking for a opportunity to go long Probably say any kind of pullback into this zone might be a bit early the one three fours But decent but I think any pullbacks if you get one to one three ones as long as the narrative is still supported by Data and the Bank of Japan and the new governor, you know, don't change their their monitoring policy You know, you would have to expect the the dollar yen to continue rising Higher so so yeah, that's where we are if you do want to look for a sell simply because you think that you know That's a decent level to get short off of then I think the one three eights is is is okay But personally my bias for now I'm watching this but I think my bias for now would be to the to the long side Continued upside on the dollar yen same thing with dollars Swiss dollars Swiss is something that I'm actually Interested in if prices actually come back down into this zone Then I will be looking for a buy if I'm looking to buy the dollar then I have to do that against the Swiss Frank and actually the dollar and against the Canadian dollar So really again my bias is to the upside to buy the dollar any pullbacks and again Price can pull back doesn't mean that you know the fundamentals have changed You know prices just pull back for liquidity reasons right and for profit-taking reasons And it gives a chance for anyone who didn't buy at these areas Right to buy again, but again as long as the fundamentals have not changed and so You know price and value is two different things. So Ultimately, I want to be a buyer of this currency pair if it presents the opportunity So I think any kind of pullback down to those zero point nine two ninety two cent area 9 to 40 I would be looking for Potential buy on that if you do want to get short on this Swiss Frank I think any of these zones to look for short trades But I think the path of these resistance is to the upside dollar CAD again saying this for the past a couple weeks The Bank of Canada is not looking to hike rates any time soon So for me, I think any pullbacks into you know, these zones are A buying opportunities. I prefer a deeper pullback, but If you do get a pullback into that one three five area You think that's enough of a discount then look for that, you know area to be a buy personally I'd look for really the one three four eighties to be a buyer on this currency pair from a cell perspective Probably say really put it a higher zone Would be really the cell Right here. I mean you do have the supply zone If I'm drawing it have to be yeah from put it from here But that level has been touched several times So I wouldn't expect that really to hold I put it here the fresher area up top and even higher Drag this actually all the way up to the top would probably be the the better area when you get a wide zone like that Of supply what you want to do is just break it up with areas of support and resistance It's like there's daily resistance there and levels been traded So and then you're looking at probably the absolute highs right there And in between those and again You can go down to the into the local levels like you know the four-hour if you see any kind of four-hour levels within that area of Supply but overall you're looking at this as a an absolute high and this is an absolute low And where are we between that high and that low at the moment? Between a high and that low 50% is known as fair value. Do you want to buy a fair value me personally? I'm looking at bargain so any kind of bargain price for the dollar US dollar any pullbacks Is what I'm looking for and probably with a take profit of somewhere around as 1 3 8 1 3 9's Moving on to the New Zealand dollar and again with the US dollar looking to pricing more hikes the dollar is you know continuing to strengthen again I have no idea whether it's going to strengthen, you know every single week in terms of you know What's gonna happen every single week? Nobody will know right the dollar can still be a buy But of course you can get pullbacks during a longer downtrend right so ultimately Nobody really knows what's gonna happen during the week But as long as the fundamentals You know remain solid if prices pulling back you have to just look at that as a as a nice buying opportunity Right if prices are getting cheaper and taking out a lot of liquidity That is probably building up above the market for it to you know reload to go shorter To go lower as to say so You do have You know supply here as well But for me if I was looking to buy this by the US dollar against the New Zealand dollar Which I'm actually not looking to do that not this pair anyway I would probably look for the 63 round number before looking at getting sure I think this area here. It's still a bit Not necessarily much of a bargain again because if you consider This is being absolute an absolute bargain for the US dollar and where we are now with this is you know Potentially considered expensive or could be expensive and most likely to be expensive because you're buying at lows Right, or you're buying at highs or selling at lows and one of the things that you don't ever want to do It's it's really sell at lows right or buy at highs So you have to wait for a pullback, you know and again pullbacks at least into decent pullback will be a decent area to look for some sort of trade Buying a value. So that's where I would look to You know and see if I was looking to trade this pair The the pound dollar now. This is an interesting one because the pound You know has had some positive data so hunt set for 10 billion budget boost as UK economy improves and So, you know Britain's economic prospects have improved enough to hand chancellor of the exchequer Jeremy hunt an extra 10 billion at Next month's budget removing the threat of a further round of austerity experts say so Yeah, it was talking about it says the economic Growth has improved businesses have stepped up investment energy prices have fallen and tax receipts have been healthier than expected That combination of factors is likely to have more than offset the impact of the OBR downward revisions. And so Yeah, there is some bright spots on the pound. I'm still not convinced Personally to buy the pound. I'm still my bias would be to short the pound and so if you're looking at shorting the pounds Then I would really look for any kind of pullback into me personally the one to two area I think that's really nice to get to get short if you're looking to buy the pound I think I guess anywhere from now it's quite a wide zone, but this area of Of support and resistance, which has been traded in the past Is decent, I think the absolute low maybe the one 18s if you're looking to buy the pound against the dollar is is is a Decent area looks look looks like it is technically anyway, but I wouldn't necessarily if I was going to be a buyer of the British pound I wouldn't do it against the dollar because the dollar is obviously quite strong and appreciating right But yeah, I think my bias is still if I'm looking to buy either of the two it would be the dollar over the British pound for now Euro Dollar now. This is where I am actually a buyer. I think the limit of this move has come down You know the 105 50s 105s now Again, I wouldn't say this is necessarily the absolute best trade in the world In terms of buying the euro, but I do think that there is going to be a bit of a Floor to this and so I do think that the overall auction And when I say auction fair value auction, I'm just basically saying that You know what most people would describe as a as a range Which it really isn't a range is actually should be called a fair value auction I think we're at a very cheap area in terms of buying the euro so I do think that that is That this now is a decent buy We could obviously come slightly lower. There are some areas of demand here Demand and then you've got another area down to the 103 102 so I would be surprised if it did come down there But the euro at the moment Yeah, we do have high Core inflation as well. So euro areas core inflation problem to come to the fore So China's PMI's to prove to provide clues on the success of economies reopening and this is more to do with Brazil but It talks about fresh data from the eurozone are set to highlight why European Central Bank officials are hanging onto their hawkish tone Even as the regions were worst ever spike in prices recedes and so Inflation is a problem everywhere. And if you have two central banks that are looking to high crates Yeah, you've got the Fed and you've got the ECB What typically should happen with price is that it should be a price acceptance and an auction that is You know accepted between, you know, whatever price which was at the moment is the one tens, you know Up here and possibly where the 105s are right? That's what the logic is so You know, I think that the euro is probably going to be cheap somewhere around his 105 areas could be cheap You know now maybe slightly cheaper, but I do think around here should be decent For a buy and I'm looking for an entry On obviously I say obviously but on a lower time frame or a higher time frame depending on You know what it gives me and I think that the there should be a bit of respite on the On the dollar strength if the euro And the ECB are still hawkish and the data supports that narrative. So that's where I am on that Aussie dollar again with the dollar strengthening I think the Australian dollar has suffered a little bit. There's been a really Quite a wide zone of demand around here But again, if you're looking at breaking that zone up Within that zone look for major levels of of support and resistance, which we're at right now And so Australia is definitely one of my top buyers as we go into for 2023 Based off of China reopening and hopefully China's reopening is positive because if it's not then I think the Australian dollar could end up falling even further But as long as you know, China's reopening zero covered policy is going well I do actually think that the Australian dollar should be a decent buy And if you really just look at where we are Over the past, you know, maybe four or five months you think this low to this high Really prices are just putting back right into some sort of a fair value because again that To there and if you go fair value Right fair value is actually around about the 66 70s and so I think this area here is going to be very interesting for a potential buy on the Australian dollar If you want to buy the Australian dollar against the US dollar that is that's an interesting area But I'm staying away from this. I've got my eye on other Australian dollar pairs that I think are better suited and Are likely to go a bit higher And so yeah, that's where we are if you're looking to buy the The the the US dollar and you've got several zones in fact just above here, which is Going to be that supply zone there You've got another Supply zone there you've got one here and then you've got one at the highs and so Yeah, I think that's uh These ones are okay. I think probably around a 69 will be probably the better area to look for any kind of short trades But again, not really a pair. I'm looking to I'm looking to trade at all But I do think this is quite interesting Going forward Especially into the second half of the year where the actual US dollar is expected to decrease in value Once the their hiking cycle comes to an end and they hopefully get a Grip on inflation if they don't then they're going to continue to hike Gold now gold again because the dollar has Increased in value that has an inverse effect on gold But gold remember that colossal central bank buying drives Gold demand to decade high and this was about a couple weeks ago to 31st of january So this was obviously the headline around here right around Yeah, towards the end of january And of course whenever you see their headlines the smart money have made their money, right? And the headlines and so it's not surprising to see prices actually just pulled back and again If you look at you know where prices were from november to the highs We actually haven't had a decent pullback for ages for months And so this as the dollar starts to strengthen Temporarily, I don't think some strengthen for for too much longer Of course long enough for our potential to make some money or to make some money off it But into the you know towards the end of the maybe the second half of the year Or towards the end of the first half of the year into the second half of the year from the dollar should Start to Devalue and so now anyone who missed out on this, you know these big moves, right? They wanted to buy gold You know back in november december and now and now I've got their chance right They've got a chance to now start buying gold If you missed out on this this this big run And so the central banks are buying and when they start buying they don't just you know stop buying By the way, they they typically buy for and start hoarding for for months and years matter of fact and so Yeah, I do think this is another opportunity for them to start to look for any kind of long trades And again, if you're thinking more long term on the horizon dollar devaluation potentially coming as the fed start to end their hiking cycle and then Um You've got the expectation that the us is going to head into a recession come either the end of 2023 or into 2024 And so we look at 2024 right and if you'll if you've got your eye on 20 to 24 and you're thinking to yourself Okay, you've got recession coming. You've got, you know rate cuts coming Where are you going to put your money and where do you want to start buying gold? People can start buying gold from now, right? You start buying gold years ahead because You know at least months ahead In anticipation of these types of Events right and so and and risk off events that are happening in the world, right? And so gold For me any pullbacks are decent buyers around these areas so Yep, that's the really the The longer term path the shorter term path obviously would be for you if you are looking to trade gold then you're looking at You know buying the us dollar then you'd have to look for to these areas here and any pullbacks to these supply zones as being you know short short trades right in in anticipation over the fed hiking For more and for and for longer at least, you know over the next few months or so and so That is gold now the eagle eye amongst you might have seen the euro CAD and think it's of why Have I put the euro CAD and it's something I've decided to do each week and really kind of show you You know that we do take trades at trading 180 don't really talk about trades too much, but um Yeah, I do like a trade of the week Just to show you basically a bit more extra on Any kind of charts and the analysis and so, uh, yeah, this was my trade of the week. This is basically what happened A couple weeks ago. This was on the 10th of February and actually hit, you know targets or partial targets anyway on the couple of days ago, so Looking at this and just going back and showing you why now we have a spreadsheet in trading 180 in the mentoring group Uh column j is where I show everybody My my bias and l basically means my biases to the long side. These don't these Biases don't really change too often and anyone who's been in the group can attest to this I've been we've been long euro CAD for a for a while for a good few months as the canadian dollar has in the bank of canada have Held rates and the european central bank are hawkish, right? So that alone just odd just based on that alone. It makes it makes all the sense in the world to try and get long and so um This was a video that again, um is for the members only and I do a weekend video Which goes through pretty much most of the pairs that i'm all of the two pairs that i'm trading anyway And this was on the 11th of february My weekly fundamental resentment analysis for the private members which goes into, you know, obviously the strategies and the reasons why You can see here that um, you know, this is where we were placing who asked placing my uh Stop loss and I was going um just basically explaining in this video the setups the reasons why etc And uh, yeah, basically this is what happens. So this ended up being a nice 2.3 to 1 i'm actually still in this position. I took four positions on this took two positions up top um So that's a profitable trade now, and I've got two which i'm swing trading uh one to the one uh, four 1.45 area and one maybe that might go beyond that Who knows but um, let's see what happens depends on how hawkish the uh the ecb is but yeah Uh, this was basically my trade uh of the week euro cad Made all the fundamental sense in the world not too many traders would have would have bought here Right, not too many trades would have bought here. Um, you know, especially after this massive Bearish candle, right? Who's buying here? Who is going to buy here pretty much? Nobody if you're a technical trader, but if you understand fundamental analysis, yeah You would have been or should have been at least a bit confident that that was actually a bargain price because it was a bargain price here Right, and so I was just basically showing in that video that i'm looking to Put my uh where i'm looking to enter right at the end of the candle best price put the uh Pause that um, and then put my stop loss uh 80 pips below and uh, yeah, there it was And there was the trade worked out which is still you know, I'm still obviously looking to swing trade the rest and so Yeah, that's where we are And um, and yeah, that was my trade of the week So guys, I hope you have a great trading week. Uh, I'll try and get back to Any of your comments if you do have any questions, uh, definitely put them in the um The question box, uh the comment box below Um, please, you know think through your questions. Don't ask me. How do I trade fundamental analysis? It's a silly question because it's so, you know, it's like asking me how long is a piece of string be a bit more specific And uh, if it's a good question or something that I can get back to Um, that doesn't take too long to answer because things can be in depth and I then I definitely will try to get back to you Uh, and uh, try and put you at least on the right path. Anyways guys, take care Have a good trading week and speak to you all soon