The bearish trend of the USD/MXN has remained strong and after touching low water values on Thursday near the 17.53650 mark, the currency pair remains within shouting distance of this depth as it currently trades around 17.57300 in early trading this Monday. The USD/MXN is challenging prices last seen in the summer of 2017. Technical traders will need to look at long-term price charts as they try to gain a viewpoint regarding potential developing values.
USD/MXN Thursday’s Lows within Plain Sight as a Speculative Target
Having proven over the long term the USD/MXN is enjoying a bearish trend; the Forex pair remains intriguing for speculative sellers. Additionally the notion that last week’s lows remain nearby may be enough for speculators to continue to pursue downward momentum. Traders obviously need to acknowledge there are no one-way directions in Forex; reversals certainly will take place higher. Depending on the amount of leverage being used while trading the USD/MXN, any movement higher can knock a speculator out of trade all too quickly.
Traders of the USD/MXN should not get overly ambitious. While it appears financial institutions believe the U.S. Federal Reserve will have to consider pausing its aggressive interest rate stance in the near term, there are no guarantees. There is also a question regarding when and where financial institutions may believe the Mexican Peso has simply gotten too strong. However, the long-term parade lower has shown little signs of slowing quite yet.
U.S Data Could be a Factor for the USD/MXN Today
- Empire State Manufacturing statistics will be released today and the outcome will show how many corporations in New York view their current business outlook.
- If there is a negative reading this could be an additional piece of ammunition for financial institutions to believe the U.S Federal Reserve will be forced to put the ‘brakes’ on an interest rate hike in June.
Quick-hitting trades may be favored by USD/MXN speculators in the near term. Potentially selling the currency pair after slight reversals higher, and looking for downward momentum to reignite may feel justified as a wager. Support levels from late last week also continue to look attractive and could prove vulnerable if speculative selling remains strong in the USD/MXN. However, traders need to be braced for the potential of reactionary buying to sometimes take place in the USD/MXN; this is based on the notion some major institutions may view the currency pair as being oversold for the moment.
USD/MXN Short-Term Outlook:
Current Resistance: 17.59700
Current Support: 17.55260
High Target: 17.63800
Low Target: 17.53010
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