The Aussie completed a 500 pip range week with some consolidation of earlier gains. The upcoming week consists of all important employment data among other events. Here’s an outlook for the Australian events, and an updated technical analysis for AUD/USD. A slowdown in China and very disappointing retail sales weighed on the Aussie, while a hawkish outlook from the RBA and jumping building approvals kept it up. The factor that eventually turned the weak into negative came from Europe: Trichet’s dovish attitude strengthened the US dollar and sent down commodity prices, pushing the Aussie lower. Let’s start: AUD/USD chart with support and resistance lines on it. Click to enlarge: ANZ Job Advertisements: Monday, 1:30. The ANZ bank looks at job advertisements in papers to measure the job market. In the past few months, steady gains have been reported, and this was highly correlated with the official job figures published afterwards. This indicator is expected to show another gain of over 1%, leading to good figures later on. Trade Balance: Tuesday, 1:30. Australia’s trade balance was very disappointing last month, and fell to a deficit, after three months of surpluses. A correction is expected now, with a surplus of half a billion A$, compared with a deficit of 200 million last time. NAB Business Confidence: Tuesday, 1:30. This bank measures the mood within businesses. Optimism squeezed last month according to the National Australia Bank with the score falling from 14 to 9. A small rise is likely now. Annual Budget Release: Tuesday, 9:00. Once a year, the finance minister publishes the suggested budget. The budget contains important expectations regarding inflation and employment. A small downgrade in expectations might be seen now, weighing on the Aussie. Chinese CPI: Wednesday, 2:00. The Chinese authorities are fighting inflation, but it still remains high. It’s now expected to remain around last month’s figure of 5.4% (annualized). China is Australia’s main trade partner, and any rise in inflation in the economic giant may trigger worries abut further tightening, weakening the Aussie. Employment data: Thursday, 1:30. The big event of the week will likely be positive for the Aussie. Last month, the Australian job market saw a big correction with a gain of almost 38,000 jobs. A more modest gain of around 17K is likely now. The unemployment rate, that unexpectedly fell to 4.9% last month, isn’t expected to move. The current situation is excellent, and no change means good news. * All times are GMT. AUD/USD Technical Analysis Two attempt to conquer 1.10 failed, and this marked the beginning of the fall. But after bottoming out above 1.05, the Aussie made a nice recovery, closing around the pivotal 1.07 line (discussed last week). Technical levels, from top to bottom: In unchartered territory, the line of 1.1150 might serve as resistance. The fresh float era high of 1.1012 is already a more definite line of resistance, just above the round number of 1.10. 1.0850 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’s followed by 1.0775 which was a previous weekly high and a resistance line just now as well. Minor support is at 1.07. It provided some support a few weeks ago. More important support is at 1.0580, which capped the pair for long days – a stubborn line indeed. The round number of 1.05 is minor support, or more precisely speaking, an wide extension of 1.0580. 1.04 was a distinctive line that worked in both directions at the beginning of April. 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 far behind. I turn from neutral to bullish on AUD/USD. The Aussie had its share of consolidating it’s impressive gains. Also the consolidation was quite impressive. Australia still has a strong economy and is now expecting a rate hike, so there’s room for gains. 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/Dollar forecast. For the Japanese yen, read the USD/JPY forecast. For GBP/USD (cable), look into the British Pound forecast. For the Australian dollar (Aussie), check out the AUD to USD 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. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam AUD/USD ForecastMinors share Read Next USD/CHF Outlook May 9-13 Yohay Elam 12 years The Aussie completed a 500 pip range week with some consolidation of earlier gains. The upcoming week consists of all important employment data among other events. Here's an outlook for the Australian events, and an updated technical analysis for AUD/USD. A slowdown in China and very disappointing retail sales weighed on the Aussie, while a hawkish outlook from the RBA and jumping building approvals kept it up. The factor that eventually turned the weak into negative came from Europe: Trichet's dovish attitude strengthened the US dollar and sent down commodity prices, pushing the Aussie lower. 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