Fundamental view:

The Australian dollar has been back and forth during the course of the week, showing signs of confusion to say the least. The Australian dollar got hit by the Reserve Bank of Australia Minutes, as the document paved the way for a cash rate cut to a fresh record low of 0.1%. The strength of the local currency coupled with a local economic downturn after the latest Victoria’s lockdown, are among the reasons why policymakers decided to maintain a highly accommodative policy. The next RBA meeting will take place on November 3, coinciding with the US presidential election.

US NAHB Housing Market Index on19th Oct and US Crude Oil Inventories on 21st Oct created a bearish atmosphere for the pair whereas US Housing Starts on 20^th Oct and US CB Leading Index monthly report on 22^th Oct created a bullish atmosphere for the pair.

The major economic events deciding the movement of the pair in the next week are RBA Assistant Governor Bullock Speech, US Core Durable Goods Orders monthly report, US CB Consumer Confidence Index at Oct 27, Australia CPI quarterly report at Oct 28, US GDP quarterly report at Oct 29, and US Core PCE Price Index yearly report at Oct 30.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was 1.07% lower than the previous week. Maintaining high at 0.7158 and low at 0.7020 showed a movement of 138 pips.

In the upcoming week we expect AUD/USD to show a bullish trend.  The currency pair is trading above the 50 Simple Moving Average and the MACD trades to the downside. A solid breakout above 0.7189 may open a clean path towards 0.7241 and may take a way up to 0.7326. Should 0.7052 prove to be unreliable support, the AUDUSD may sink downwards 0.6968 and 0.6916 respectively. In H4 chart extended W-pattern favors prospects of a bullish trend. Also to be noted shooting star formation exerts the expectation of uptrend for the pair.