Is 80 cents finally in sight for the Aussie?

peterfz30 | iStock/360 | Getty Images

The Australian dollar dipped below the 90-cent handle this week for the first time since March, and some analysts say it could finally be on its way to 80 cents.

"The momentum remains firmly to the downside," said Stan Shamu, market strategist at IG. "I wouldn't be surprised to see selling pressure remain. Once the gap from [Monday's] open is filled, perhaps sellers will return with greater conviction."

A confluence of weak Chinese industrial production figures, strong Australian jobs data and expectations for a U.S. interest rate hike in the near future has weighed on the Australian dollar, pushing it 4 percent lower against the greenback since September 5.

Read MoreAustralia growth slows to 0.5 percent in second quarter

80 finally in sight?

The Australian dollar's strength has surprised investors. Despite ongoing economic headwinds including the end of Australia's mining boom, slowing growth in its largest trading partner China, weak commodity prices and bruised consumer and business sentiment following the government's harshest budget in two decades in May, it was stubbornly strong in the first half of the year.

A number of analysts have long been calling for the Aussie to fall as low as 80 cents - a level it hasn't seen since 2009 - as economic fundamentals come back into play, and the central bank continues to talk the currency lower. Over the past year, Governor Glenn Stevens repeatedly voiced his opinion that he would like to see the Aussie at 85 cents against the U.S. dollar.

"After being wrong on the Aussie dollar all year (I expected it to fall, but it went up), it's now going in the right direction again," said Shane Oliver, head of investment strategy and AMP Capital. "Thanks to a combination of a resurgent U.S. dollar as the [Federal Reserve] edges closer to an eventual rate hike and continuing weakness in commodity prices as highlighted by the plunging iron ore price."

Read MoreAre the Australia dollar bears weakening?

"My view remains that it's on its way ultimately to around $0.80 or even a bit below, which is a level that would neutralize the relatively high cost and price base in Australia compared to the U.S.," added Oliver.

In March, analysts at Goldman Sachs forecast a slump to 80 cents by March 2015, underpinned by expectations that headwinds were intensifying, the country's terms of trade would continue to decline and capital flows were becoming less positive, as well as geopolitical risks and tightening financial conditions in China.

Iron ore price sinks, what that means for miners?
As iron ore price sinks, which miners will get hurt?   

Oversold?

Other analysts said there's evidence the Aussie is becoming grossly oversold, noting the Australian economy still offers strong fundamentals and the currency could strengthen.

"The pair still remains the predominant high yielder in the G-20 universe," said Boris Schlossberg, managing director at BK Asset Management, referring to Australia's relatively high interest rate at 2.5 percent.

Read MoreAustralia consumer sentiment suffers setback in September

"As the Aussie approaches the key $0.90 level it is likely to find more substantial bids as some of the longer-term bargain hunters begin to re-establish positions," Schlossberg wrote in a note. "This week the market will get a glimpse at the [Reserve Bank of Australia's] minutes and the Annual report and if the tone of the releases remains neutral to positive the pair could finally find some support and stage a relief rally."

Meanwhile Robert Rennie, global head of FX strategy at Westpac, sees a risk of short-term weakness, but maintains his forecast for 90 cents by year-end.

"There is a risk in the short-term that we see it trade below where our sense of where fair value is at $0.88, but it's dependent on the evolution of China data and obviously the Fed this week too," he added, referring to the policy statement due on Wednesday.

Read MoreAustralia adds whopping 121,000 jobs in August