Economist Shayne Heffernan of takes a look at the AUD/USD trading for the week ahead.

AUD/USD hit 1.0410 on Thursday, the pair’s highest since September 28; the pair subsequently consolidated at 1.0327 by close of trade on Friday, still up 0.70% for the week.

The pair is likely to find support at 1.0242, the low of October 16 and resistance at 1.0410, Thursday’s high.

Faster price growth in Australia should help to prop up the AUDUSD in the week ahead, but we will maintain a bearish forecast for the pair as it preserves the downward trend carried over from 2011. At the same time, the aussie-dollar appears to be carving out a lower top in October as the exchange rate fails to hold above the 23.6% Fibonacci retracement from the 2010 low to the 2011 high around 1.0370, and we may see the Australian dollar threaten the monthly low (1.0148) should market sentiment deteriorate further. Parity remains a possibility here.

Tuesday, October 23

Australia is to publish an index of leading indicators, designed to predict the future direction of the economy.

Wednesday, October 24

Australia is to publish official data on consumer price inflation, which accounts for the majority of overall inflation.

China is to publish private sector data on manufacturing activity, a leading indicator of economic health.

The U.S. is to release official data on new home sales, a leading indicator of economic health, as well as government data on crude oil inventories.

Later Wednesday, the Federal Reserve is to announce its benchmark interest rate and release its closely watched monetary policy statement.

Thursday, October 25

The U.S. is to release official data on durable goods orders, a leading indicator of production, as well as data on pending home sales and initial jobless claims.

Friday, October 26

The U.S. is to round up the week with preliminary data on third quarter GDP; the foremost indicator of economic activity and the leading gauge of the economy’s health. In addition, the University of Michigan is to release revised data on consumer sentiment.

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Shayne Heffernan

Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.

Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reached a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.Read the Terms of Service

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