The Australian dollar dropped sharply, losing 350 points against the US dollar last week. AUD/USD dipped into 0.88 territory and closed the week just above the 0.89 line, at 0.8902. It’s a very busy week, with 14 releases on the schedule. Here is an outlook of the events and an updated technical analysis for AUD/USD. Australian Building Approvals had a dismal reading, and this set the tone for the entire week as the Aussie looked horrendous. In the US , employment data was mixed, but the greenback got support from strong GDP and manufacturing releases. [do action=”autoupdate” tag=”AUDUSDUpdate”/]AUD/USD graph with support and resistance lines on it. Click to enlarge: &amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;lt;img alt=”AUD USD Forecast July8-12″ src=”http://forexcrunch.wpengine.netdna-cdn.com/wp-content/uploads/2013/07/AUD-USD-Forecast-July8-12-350×196.png” width=”350″ height=”196″ /&amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;amp;gt; MI Inflation Gauge: Monday, 00:30. This monthly indicator helps analysts track CPI figures, which are only released each quarter. The indicator has been fairly steady and posted a flat reading of 0.0% in July. Retail Sales: Monday, 1:30. The first key release out of Australia comes out very early in the week. Retail Sales is a critical indicator of consumer spending, and the picture has not been bright. The July release posted a weak gain of just 0.1%, short of the estimate of 0.4%. The markets are expecting better news this time around, with an estimate of 0.4%. AIG Services Index: Monday, 23:30. This index has not looked strong, with the past two readings around the 41-point level. A reading below the 50 line indicates contraction. Trade Balance: Tuesday, 1:30. Australia has posted three straight trade surpluses. The July reading came in at 0.67 billion dollars, beating the estimate of 0.05 billion. The markets are expecting a stronger release in August, with an estimate of 0.81 billion. If the indicator can meet expectations, it would be the largest surplus in over a year. ANZ Job Advertisements: Tuesday, 1:30. This important employment indicator has looked weak, posting four consecutive declines. The markets will be hoping for better news in the upcoming reading. HPI: Tuesday, 1:30. This housing inflation index provides a snapshot of activity in the Australian housing sector. The index gained just 0.1% in July, way off the estimate of 1.9%. The markets are expecting a strong turnaround in the upcoming release, with an estimate of 1.3%. RBA Cash Rate: Tuesday, 4:30. Most analysts expect the key interest rate to remain at 2.75%, although RBA Governor Glenn Stevens has hinted about a rate cut, so traders should be prepared for such a scenario. If the RBA does take action, it would likely be in the form of a 0.25% rate reduction. The RBA will announce its decision in a rate statement. AIG Construction Index: Tuesday, 11:30. This index is in deep contraction, and has been under the 40-point level since March. The markets are not expecting any significant changes in the August release. Home Loans: Wednesday, 1:30. This important indicator has shown quite a bit of fluctuation, but continues to post gains. The July estimate came in at 1.8%, which was shy of the estimate of 2.3%. The forecast for the August release stands at 2.2%. RBA Assistant Governor Guy Debelle Speaks: Wednesday, 1:30. Debelle will speak at a financial forum in Sydney. A speech which is more hawkish than expected is bullish for the Australian dollar. Employment Change: Thursday, 1:30. This key event can affect the direction of AUD/USD. In July, the indicator pointed to 10.3 thousand new jobs, will above the estimate of 0.3 thousand. The markets are anticipating a weaker release in August, with an estimate of 6.2 thousand. Will the indicator beat this forecast? Chinese Trade Balance: Thursday, Tentative. Chinese Trade Balance is prone to leaks, so traders should be careful with this release. The estimate for the upcoming release is 26.2 billion dollars, which is lower than the July release of 27.1 billion dollars. RBA Monetary Policy Statement: Friday, 1:30. The RBA policy statement can provide clues about the central bank’s future monetary policy, which could impact on AUD/USD. A statement which is more hawkish than expected could push the Aussie higher. Chinese CPI: Friday, 1:30. The Australian dollar is often sensitive to key Chinese data, since China is Australia’s number one trading partner. CPI jumped from 2.1% to 2.7% in July, beating the forecast of 2.5%. The estimate for the August release stands at 2.8%. AUD/USD Technical Analysis AUD/USD started the week at 0.9253, which was also the high of the week. The Aussie then took a nasty tumble, dropping all the way to 0.8870, briefly breaking past support at 0.8893 (discussed last week). The pair closed the week at 0.8902. Live chart of AUD/USD: [do action=”tradingviews” pair=”AUDUSD” interval=”60″/] Technical lines from top to bottom: With AUD/USD dropping sharply, we start at lower levels. 0.9428 had played a support role since late 2011, but was breached in June, and has provided strong resistance since that time. 0.9283 has seen a lot of action in the month of July, alternating between resistance and support. It started last week as weak resistance, but held firm as the Australian dollar pointed lower right from the start of the week. 0.9180 saw a lot of activity in July. It was breached last week as the pair slumped and is currently providing resistance. 0.9041 was providing weak support in the first half of July and is also providing resistance. It has strengthened as the pair trades at lower levels. This round number of 90 is next. This psychologically important level had provided support since September 2010, but AUD/USD easily barreled below this level. Will it remain in a resistance role this week or will the Aussie move higher? 0.8893 was last breached in August 2010, but could not stop the pair’s downward momentum, and was briefly breached. However, this line was back in place at the end of the week and is providing weak support. It could be tested early next week. 0.8747 has remained in place since July 2010. 0.8580 was a key line in May and July 2010, and has gained in significance now that the Australian dollar is trading at such low levels. The final support line for now is at 0.8392. When this line was breached in July 2010, AUD/USD posted a tremendous rally and climbed above the 1.10 level. I am bearish on AUD/USD. The Aussie keeps on sliding, and the 90 level easily gave way last week as the US dollar continues to surge. The downward trend could continue unless Australian releases impress the markets. The US economy appears to be on the right track and increasing speculation about QE tapering in September could give the US dollar some broad strength. The Aussie sometimes moves in tandem with gold. You can trade binary options on gold using this technical analysis. Further reading: For a broad view of all the week’s major events worldwide, read the USD outlook. For EUR/USD, check out the Euro to Dollar forecast. For the Japanese yen, read the USD/JPY forecast. For GBP/USD (cable), look into the British Pound forecast. For USD/CAD (loonie), check out the Canadian dollar forecast. Kenny Fisher Kenny Fisher Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer. Kenny's Google Profile View All Post By Kenny Fisher AUD/USD ForecastMinorsWeekly Forex Forecasts share Read Next GBP/USD: Trading the British Manufacturing Aug 2013 Kenny Fisher 9 years The Australian dollar dropped sharply, losing 350 points against the US dollar last week. AUD/USD dipped into 0.88 territory and closed the week just above the 0.89 line, at 0.8902. It's a very busy week, with 14 releases on the schedule. Here is an outlook of the events and an updated technical analysis for AUD/USD. Australian Building Approvals had a dismal reading, and this set the tone for the entire week as the Aussie looked horrendous. In the US , employment data was mixed, but the greenback got support from strong GDP and manufacturing releases. 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