A very busy week expects Aussie traders, with the rate decision and employment figures being the highlights. Here is an outlook for the Australian events, and an updated technical analysis for AUD/USD. The Australian dollar showed huge strength in the light of the Chinese slowdown. It enjoyed the optimism from Greece to rise on risk trade. Will this continue? AUD/USD daily graph with support and resistance lines on it. Click to enlarge: MI Inflation Gauge: Monday, 00:30. The Australian government publishes official inflation data only once per quarter. This makes the unofficial figure from the Melbourne Institute an updated measure of price changes. According to MI, price rises have slowed down in the past two months, dropping to 0.2% last month. A similar figure is likely now. ANZ Job Advertisements: Monday, 1:30. ANZ measures the amount of job advertisements in the media for its indicator. Last month, the big drop it recorded (6.5%) hinted a weak official jobs figure. Also now, this indicator will provide a hint for the employment change number. A correction, with a small rise, is expected now. Retail Sales: Monday, 1:30. Australian consumers surprised and were quite upbeat last month. The volume of sales rose by 1.1%. A smaller rise is expected now. A drop would weigh on the Aussie. Building Approvals: Monday, 1:30. This housing sector indicator is very volatile. Nevertheless, it has a significant impact on the currency. After a leap of 8.6% two months ago, a small drop of 1.3% was recorded last month, 1.3%. A rise is likely now. AIG Services Index: Monday, 23:30. The Australian Industry Group provides an important PMI-like indicator for the services sector. After rising above 50 points two months ago, it fell just short of it and scored 49.9 last month. The sector is swinging between contraction and growth. The index will probably edge up. Trade Balance: Tuesday, 1:30. Australia’s trade balance has experienced a see-saw between surpluses and deficits. But in the past two months, it has been positive, with surpluses of over 1.6 billion. A drop is estimated now. Rate decision: Tuesday, 4:30. The central bank will likely leave the interest rates unchanged for another month. The level of uncertainty is very high at the moment. In the long run, the RBA will probably raise the rates. Any such hints will help the Aussie, but given the recent clouds over the global economy, the hints might be in the opposite direction. So, the accompanying statement will be closely watched, and will guarantee high volatility. AIG Construction Index: Wednesday, 23:30. Contrary to the services sector, Australia’s construction sector is struggling. According to AIG, it is contracting very quickly, with the index falling below 40 points last month. It is expected to remain unchanged. Is Australia seeing the housing bubble explode? Employment data: Thursday, 1:30. The past two jobs reports have been very disappointing in Australia. Two months ago, almost 30,000 were lost, and this was followed by a very minor recovery last month, only 7,800 jobs gained. A bigger rise is expected now. Regarding the unemployment rate, it remained stable and excellent in the past three months, at 4.9%. No change is expected now. * All times are GMT AUD/USD Technical Analysis The Aussie struggled around low support, and even fell below this 1.4440 line (discussed last week) to find support at 1.0390. But a dramatic change came, with a nice breakout. The pair eventually settled above 1.0670, and aimed for higher levels. Technical levels, from top to bottom: The float era high of 1.1012 is already a definite line of resistance, just above the round number of 1.10. 1.088 had a chance to work in both directions – capping the pair on the way up, and later temporary halting the pair on the way down. It was a swing high in May. 1.0775 was a key resistance level in the past weeks, and it remains a very tough resistance line It has shown its strength just now. 1.0670 is now strong support, that provides a cushion for the current higher range. 1.0580 turns into support now, after it was broken. It capped the pair for long days. Its role is minor now after being pierced through on the way down as well as on the way up. The round number of 1.05 managed to cushion the recent fall, and returns to be of importance.. 1.0440 proved to be a very strong support line after being a swing low a month and also recently, although it is slightly weaker now. 1.0390 was a distinctive line that worked in both directions at the beginning of April and is weak support now. A stepping stone for the Aussie on its way up was 1.0315. It is likely to be a stepping stone on the way down if the pair collapses. An important cushion is 1.0254, the 2010 high that is still below, but getting closer. I remain neutral on AUD/USD. The Australian fundamentals are still good, but they are somewhat fragile, especially in the light of the slowdown in China and fears about the local housing market. In addition, the end of QE2 in the US also poses risks for the Australian dollar. This week, with the influx of data, is very important. Gregor Horvat uses Elliott Wave analysis to analyze the renewed strength of the Aussie. 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 the New Zealand dollar (kiwi), read the NZD forecast. For USD/CAD (loonie), check out the Canadian dollar For the Swiss Franc, see the USD/CHF forecast. USD/CAD (loonie), check out the Canadian dollar. 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AUD/USD ForecastMinors share Read Next USD/JPY Outlook – July 4-8 Anat Dror 10 years A very busy week expects Aussie traders, with the rate decision and employment figures being the highlights. Here is an outlook for the Australian events, and an updated technical analysis for AUD/USD. The Australian dollar showed huge strength in the light of the Chinese slowdown. It enjoyed the optimism from Greece to rise on risk trade. Will this continue? AUD/USD daily graph with support and resistance lines on it. Click to enlarge: MI Inflation Gauge: Monday, 00:30. The Australian government publishes official inflation data only once per quarter. 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