Fundamental view:

Australian dollar dropped against the American dollar during the trading course of the week However, the commodity-linked currency AUD managed to reach its 2022 high of 0.7440 against its American rival before dropping.  Headlines relating to Russian invasion of Ukraine dominated the where the situation worsened on a daily basis. However Market sentiment improved at the weekend on Friday with Russian President Vladimir Putin’s comment that there were “certain positive developments” in talks with Ukraine.

The Fed has promised a 0.25% hike on March 16. Treasury futures have the odds at 95.9%. Markets are undecided whether the governors will initiate a reduction of the bank’s $9 trillion balance sheet. On contrary, Reserve Bank of Australia insists on its wait-and-see stance.

In this week, NAB Business Confidence on 8^th March and US Initial Jobless Claims on 10^th March helped bullish trend whereas US JOLTS Job Openings on 9^th March and US CPI monthly report on 10^th March helped bearish trend for the pair.

The major economic events deciding the movement of the pair in the next week are RBA Meeting Minutes, NY Fed Empire State Manufacturing Index at Mar 15, US Retail Sales monthly report, Fed Interest Rate Decision at Mar 16, Australia Employment Change, Initial Jobless Claims, US Fed Industrial Production yearly report at Mar 17 and Fed Governor Bowman Speech at Mar 18.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was 0.81% higher than the previous week. Maintaining high at 0.7440 and low at 0.7245 showed a movement of 195 pips.

In the upcoming week we expect AUD/USD to show a bearish trend. The currency pair is trading below the 50 Simple Moving Average and the MACD trades to the downside. Should 0.7207 proves to be unreliable support then the pair may fall further to 0.7128 and 0.7012 respectively whereas a solid breakout above 0.7402 will open a clear path upward to 0.7518 and then will further raise up to 0.7597. In H4 chart bearish gartley pattern formation favors prospects of a bearish trend. Also to be noted bearish engulfing formation exerts the expectation of downtrend for the pair.