The USD/MXN is trading near the 17.37100 mark as of this writing. The past week of trading has demonstrated a rather intriguing technical range for the currency pair as values are clearly being fought over, but also strongly suggest financial institutions for the moment might believe price equilibrium has been found. While the value of the USD/MXN is certain to become more volatile in the coming two days, traders may believe they can take advantage of the short-term.
This coming Wednesday the U.S Federal Reserve will release its FOMC Statement. No change to the Federal Funds Rate will happen this week, but financial institutions are keen to hear what the Fed says regarding their outlook for the mid-term. The Fed will likely continue to say inflation remains stubborn, though they see some signs of the U.S economy starting to be affected by the higher interest rates.
Short-Term Technical Moves can be Dangerous for USD/MXN Traders
The USD/MXN could develop a wider range early on Wednesday as the Fed’s rhetoric is prepared for via defensive positions. Until then quick hitting trades that look to take advantage of momentary short-term trends may prove attractive, but they also may be hard to find. Traders may feel the USD/MXN still can trade lower over the mid-term, but looking for downside momentum via short-term trades might prove frustrating.
One way to try and accomplish selling positions technically for day traders is to wait for what is perceived to be strong resistance to be hit and then igniting a selling position. The USD/MXN has traded largely within values between 17.30000 the 17.50000 ratios the past week, but there have been outliers lower and higher. Solid risk management is needed and stop losses are certainly urged for short-term traders.
USD/MXN is Dollar Centric while Energy Prices Stumble
Crude Oil prices globally have stumbled and are trading at mid-term lows along with other energy resources; this affects the price of the Mexican Peso negatively. However, the USD/MXN also trades largely within a USD centric mode and the Fed’s coming pronouncements this week will cause volatility. Short-term traders may believe the range of the USD/MXN the past week offers wagering opportunities now, but conservative traders may want to wait for the Fed’s FOMC Statement on Wednesday.
- The USD/MXN is within the middle of its value when a one month chart is viewed also.
- Price equilibrium may remain rather strong, but volatility will erupt as financial institutions position for Wednesday’s Fed rhetoric.
- Traders who want to bet on direction today and tomorrow will likely need quick hitting take profit targets and steady emotions in what may prove to be rather choppy Forex sessions near-term.
USD/MXN Short Term Outlook:
Current Resistance: 17.42900
Current Support: 17.35010
High Target: 17.49600
Low Target: 17.30300
