Fundamental view:

The Australian dollar initially fell during the course of the week but seems as if it found a way to go higher towards the end of the week. Earlier in the week, the RBA announced that it left its policy rate unchanged at 0.25% as expected. In its policy statement, the Australian central bank noted that it will not increase its policy rate until convincing progress is made towards full employment and that it’s confident inflation will be sustainably within the 2–3% band. The RBA further acknowledged that it continues to consider how additional monetary easing could support jobs as the economy opens up further. These updates added to the strength of the AUD.

US ISM Services PMI on 5^th October and Australia Trade Balance on 6^th October favored bearish trend for the pair whereas RBA Cash Rate on 8^th October and Unemployment Claims on 8^th October created bullish trend for the pair.

The major economic events deciding the movement of the pair in the next week are Federal Budget Balance, US Core PPI monthly report at Oct 13, RBA Governor Lowe Speech Oct 14, Australia Employment Change, US Initial Jobless Claims at Oct 15, and US Retail Sales monthly report at Oct 16.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was 0.48% higher than the previous week. Maintaining high at 0.7243 and low at 0.7095 showed a movement of 147 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 0.7290 may open a clean path towards 0.7340 and may take a way up to 0.7438. Should 0.7143 prove to be unreliable support, the AUDUSD may sink downwards 0.7045 and 0.6996 respectively. In H4 chart bullish butterfly pattern formation favors prospects of a bullish trend. Also to be noted three white soldiers formation exerts the expectation of uptrend for the pair.