Fundamental view:

The Australian dollar has fallen a bit during the course of the trading week. The draconian Australian approach to the Delta variant led to the collapse of the down-under job market in August with the largest loss of employment since May 2020. Delta closures and restrictions reported in several places, led to the fall of the Aussie. The AUD/USD is highly sensitive to the global risk environment and the uncertainty in China. On the other hand, The Federal Reserve’s possible taper announcement at its Wednesday meeting reinforces the notion that US rates are headed higher, even if the timing remains undecided.

US Core CPI monthly report on 14th Sep and US TIC Net Long-Term Transactions on 16th Sep created downtrend whereas Australia NAB Business Confidence on 14th Sep and Australia Employment Change on 16th Sep created downtrend 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 Sep 21, RBA Assistant Governor Bullock Speech, US EIA Crude Oil Stocks Change, Fed Interest Rate Decision at Sep 22, US Initial Jobless Claims at Sep 23 and Fed Chair Powell Speech at Sep 24.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was 1.25% lower than the previous week. Maintaining high at 0.7375 and low at 0.7261 showed a movement of 114 pips.

In the upcoming week we expect AUD/USD to show a bearish trend.  The currency pair is trading below the 200 Simple Moving Average and the MACD trades to the downside. A solid breakout below 0.7224 may open a clean path towards 0.7186 and may take a way down to 0.7110. Should 0.7338 prove to be unreliable resistance, the AUDUSD may raise upwards 0.7414 and 0.7452 respectively. In H4 chart descending triangle pattern breakout favors prospects of a bearish trend. Also to be noted hanging man formation exerts the expectation of downtrend for the pair.