Friday’s AUD/USD bearish outside bar and the break below 0.7600 key support level has opened up the door for the current pullback to extend to 0.7500 big round number. This is still considered a retracement inside a more defined bullish trend that started since the beginning of the year. In this regard, the AUD/USD downside looks limited to 0.7500-0.7466 big inflection zone that can produce a bounce. The 0.7600 old support zone should act as resistance and earlier in the week we can expect a retest of this level before the bearish momentum to accelerate to the downside. The break and the strong close below the 200-day EMA are also supporting the bearish case. Not only the Australian economic calendar looks heavy, but at the same time China manufacturing activity is scheduled to be released on Thursday and can be the catalyst for more bearish momentum. China manufacturing activity is still contracting as latest figures have shown a reading of only 49.6 below the 50 mark. Traders should also be aware of the RBA assistant Governor Debelle speech on Wednesday and Aussie Retail Sales which are expected to inch higher from 0.1% to 0.3%.

AUDUSD Weekly Forex Forecast - 29th Aug to 2nd Sept 2016 - BEARISH