Fundamental view:
The AUD/USD pair has recovered some ground these days, as the greenback remained out of the market’s favor. Little of interest happened in Australia last week. The most encouraging news came from the coronavirus front, as the country seems to have controlled the latest outbreak, reporting on average 20 new cases per day this week.
Crude Oil Inventories on 30th Sept, Unemployment Claims monthly report on 1st Oct created a bearish trend for the pair whereas Japan Tankan Manufacturing Index on 1st Oct and US Unemployment Rate on 2nd Oct created a bullish trend for the pair.
The major economic events deciding the movement of the pair in the next week are US ISM Non-Manufacturing PMI at Oct 05, RBA Interest Rate Decision, Fed Chair Powell Speech at Oct 06, EIA Crude Oil Stocks Change at Oct 07, US Initial Jobless Claims at Oct 08, and RBA Financial Stability Review at Oct 09.
AUD/USD Weekly outlook:
Technical View:
Last week’s high was 1.57% lower than the previous week. Maintaining high at 0.7209 and low at 0.7032 showed a movement of 176 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 0.7061 may open a clean path towards 0.6958 and may take a way down to 0.6884. Should 0.7237 prove to be unreliable resistance, the AUDUSD may raise upwards 0.7311 and 0.7413 respectively. In H4 chart bearish butterfly pattern favors prospects of a bearish trend. Also to be noted hanging man candle formation exerts the expectation of downtrend for the pair.
| Preference |
| Sell: 0.7164 target at 0.7014 and stop loss at 0.7242 |
| Alternate Scenario |
| Buy: 0.7242 target at 0.7412 and stop loss at 0.7164 |
