The USD/MXN has traded with flavor the past week and been challenging for even experienced speculators. The Mexican Peso has seen a solid display of adding value versus the US Dollar since April, but last Thursday’s trading highlighted forex seldom is a one way avenue. Key resistance levels short term appear to be under fire as today’s trading has begun, this as risks in the broad financial markets are once again being tested by worries regarding another onslaught of Coronavirus globally.
Strong resistance appears to be the 23.0000 level this morning for the Mexican Peso. If traders speculate with short term buying of the USD/MXN this value juncture could prove vulnerable. Part of the early equation today will be what happens on Wall Street. If safe haven fears mount, the Mexican Peso could see short term value erosion. However, the higher mark of 23.2000 appears to be a significant higher resistance level and potential target for traders with a taste for speculation.
While the overall trend of the Mexican Peso continues to look strong against the US Dollar, experienced traders know that both sides of a trade can offer value if managed correctly. The USD/MXN may prove to be a capable short term buy around the 22.5000 level if traders believe the support level of 22.0000 will hold. Meaning traders could look for upside potential from the US Dollar today while using a fairly close stop loss value and a proper amount of leverage and patience.
Choppy trading has been the story for the Mexican Peso the past week, with support of 21.5000 and resistance proving strong around 22.7500. The trading range this week for the USD/MXN may face further tests of last week’s range depending on the magnitude of nervous sentiment being generated on major stock indices. Weakness on Wall Street today and tomorrow could cause the Mexican Peso to lose some of its momentum and test resistance above. In order to speculate on the USD/MXN the next two days traders should watch US markets carefully for a gauge regarding potential direction short term.
Mexican Peso Short Term Outlook:
Current Resistance: 22.7500
Current Support: 22.000
High Target: 23.2000
Low Target: 21.5000
