The Aussie dropped for a fourth week in a row. Will it continue lower at the beginning of the fourth quarter? We have a very busy week, with the rate decision in the limelight. Here is an outlook for the Australian events, and an updated technical analysis for AUD/USD, now in lower ground. More signs of slowdown in China and the double downgrade for New Zealand weighed on the Aussie. As risk aversion eventually took over, the Aussie, which is considered a risk currency, dropped as well.Apart from the rate decision, housing figures will be of interest this week. AUD/USD daily chart with support and resistance lines on it. Click to enlarge: AIG Manufacturing Index: Sunday, 22:30. The Australian Industry Group provides an index which is similar to purchasing managers’ indices in other countries. According to this 200 strong survey, Australia’s manufacturing sector is contracting in the past two months, as the score is under 50 points. A small drop from last month’s 43.3 points is expected now. MI Inflation Gauge: Sunday, 23:30. The Melbourne Institute has shown a relatively rare drop in prices according to its gauge. It ticked up slowily or at least remained unchanged up to now. This indicator, which fills the gap for the official quarterly release, will likely stay unchanged now. Building Approvals: Tuesday, 00:30. This is one of Australia’s most important housing sector indicators, despite its high volatility. Despite rising by 1% last month, this fell short of expectations and was far from covering big drops seen in earlier months. A small dip is likely now. Trade Balance: Tuesday, 00:30. Australia’s trade surplus remained stable last month at 1.83 billion. The figure for August will likely reflect some of the turmoil in markets, and will probably see a squeeze in this surplus. Rate decision: Tuesday, 3:30. Glenn Stevens and his colleagues didn’t move the high 4.75% interest rate in the past 10 months. During these months, expectations flipped from rate hikes and rate cuts. The RBA isn’t expected to move now, but the direction became clearer: a cut. If Stevens surprises with a cut now, the Aussie will plunge. Commodity Prices: Tuesday, 3:30. Australia’s commodity oriented economy is sensitive to changes in prices. This year over year figure will likely still show a rise, but smaller than the 25.2% reported last month. AIG Services Index: Tuesday, 22:30. Contrary to manufacturing and especially construction, the services sector returned to the growth zone according to AIG. From 52.1 points, the index is likely to drop but remain above 50, still showing growth. Retail Sales: Wednesday, 00:30. This important consumer indicator rose by 0.5%, correcting most of the drops seen in recent months. A small drop is expected now. AIG Construction Index: Thursday, 22:30. According to this indicator, the Australian housing sector is doomed and the bubble has burst. The score dropped even deeper in contraction zone, to 32.1 points. A small rise is expected from this devastating figure, but the road back to growth (above 50 points) is very long. * All times are GMT. AUD/USD Technical Analysis Aussie/USD marked low levels at the beginning of the week, but later managed to recover and get close to the parity line (mentioned last week). It then started a gradual descent, eventually closing at 0.9660, lower than the previous week. Technical levels from top to bottom: We begin from the first significant line above parity. 1.0120 was a nice cushion on a drop during July. The next line is obvious: AUD/USD parity. The very round number has strengthened in September after capping a recovery attempt. It temporarily held the pair before the downfall. Below parity, 0.9930 is weak resistance after holding back in August. The 0.98 line served as support early in the year, and serves as weak another weak line of resistance. The next round number of 0.97 was a swing low in March and also worked as support recently. Its role is stronger. 0.9622 was a fresh low in September and is immediate support right now. This was also a line of support back in September 2010. Lower, 0.9540 was a stepping stone on the way up back in the fall of 2010 and then provided critical support in November. 0.9460 capped the pair on the way up and then turned into support – it has the same role now. 0.93 – which was a clear gap line in September 2010 and is very important support on the way down. The last line for now is 0.9220, which was resistance more than a year ago. I remain bearish on AUD/USD. Australia is suffering from weakness in the housing sector and more importantly, a slower China. Together with the fall in commodity prices, and especially copper, there is more room for falls. Bernanke’s twist is still felt. This affects stocks commodities and also the Australian dollar. A rate cut would accelerate the falls. 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. 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 Expert score 5 Etoro - Best For Beginner & Experts0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 5 Read Review Open My Free Account Your capital is at risk. AUD/USD ForecastMinors share Read Next GBP/CHF Maintains Upside Bias, EUR/GBP Under Downside Pressure Yohay Elam 10 years The Aussie dropped for a fourth week in a row. Will it continue lower at the beginning of the fourth quarter? We have a very busy week, with the rate decision in the limelight. Here is an outlook for the Australian events, and an updated technical analysis for AUD/USD, now in lower ground. More signs of slowdown in China and the double downgrade for New Zealand weighed on the Aussie. 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