Fundamental view:

The Australian dollar has fallen during most of the week and reached down towards the 0.77 level, Traders now believe that the US economy is going to accelerate and that consumer inflation is more than a transitory phenomenon and it has helped the dollar to show strength. April’s US Retail Sales numbers on Friday were weaker than expected and that reversed about half of the Aussie’s loss.

Australia NAB Business Confidence on 10^th May and US Import Price Index on 14^th May favored bullish trend whereas US CB Employment Trends Index on 10^th May and US EIA Crude Oil Stocks Change on 12^th May favored bearish trend for the pair.

The major economic events deciding the movement of the pair in the next week are RBA Meeting Minutes, US Building Permits at May 18, US EIA Crude Oil Stocks Change, FOMC Minutes at May 19, Australia Employment Change, US Initial Jobless Claims, Philadelphia Fed Manufacturing Index at May 20, Australia Retail Sales monthly report and US Existing Home Sales at May 21.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was 0.36% higher than the previous week. Maintaining high at 0.7891 and low at 0.7688 showed a movement of 203 pips.

In the upcoming week we expect AUD/USD to show a bullish trend.  The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 0.7885 may open a clean path towards 0.7990 and may take a way up to 0.8088. Should 0.7682 prove to be unreliable support, the AUDUSD may sink downwards 0.7584 and 0.7479 respectively. In H4 chart alt bat pattern favors prospects of a bullish trend. Also to be noted Bullish engulfing formation exerts the expectation of uptrend for the pair.