CHINESE DATA PICKS UP WHILE U.S ECONOMIC DATA REMAINED MIXED

SOFTER U.S DATA

United States economic data remained mixed this, while Federal Reserve members voiced concerns about weak U.S inflation. Data showed U.S housing starts and building permits tumbled in September, while U.S jobless claims were at a forty-four-year low. The Federal Reserve Beige Book also showed FOMC members expressing concern about the lack of inflationary price-pressures in the American economy.

CHINESE GROWTH CONTINUES

The Chinese economy continued to post strong economic data this week, as the world's second largest economy showed no signs of slowing down. Inflation, Retail Sales and Industrial Production figures came in better than forecast for the month of September. Official data also showed Chinese third fiscal quarter gross domestic product expanding in-line with economist estimates, whilst annual GDP growth came in at 6.8 percent.

KIWI STUMBLES AUSSIE RISES

The New Zealand dollar fell sharply this week, as political woes in the country intensified, while the Australian dollar moved sharply higher on better unemployment and jobs figure. The kiwi slumped against the U.S dollar, Japanese Yen and Australian dollar, after New Zealand's First party rejected the incumbent National Party in favor of a coalition government, led by the Labour party.

• The AUDNZD pair is expected to continue to move higher while trading above the 1.1175 level, with buyers targeting the 1.1250 and 1.1300 levels.

• If the AUDNZD pair declines below the 1.1175 level, a price correction towards 1.1155 and 1.1095 remains likely.

STERLING STRUGGLES

The British pound suffered losses against the U.S dollar this week, as worse than expected economic data and Brexit negotiation deadlock hurt trading sentiment. After hitting a weekly high of 1.3311 on Monday, the GBPUSD pair fell back towards the 1.3100 level, as UK Retail Sales declined and reports from Brussels showed no progress between EU and UK negotiators over the terms of Brexit.

• In the medium-term GBPUSD sellers retain control of the pair while price action trades below the 1.3200 level. Further declines towards the 1.3070 and 1.3030 levels remain likely.

• If GBPUSD buyers can push price-action above the 1.3200 level, a further advance towards 1.3260 and 1.3333 remains likely.