The USD/ARS official exchange as of this writing is slightly below the 170.000 ratios, and there are many reasons to believe technically resistance will continue to prove extremely vulnerable. Day traders who can speculate on the USD/ARS should understand there is little reason to actually try and sell the currency pair. However, there is plenty of reason to still fear trying to wager on the steady incremental higher price action which has haunted the USD/ARS for a very long time.
The Good News is that Argentina is playing against the Netherlands Tomorrow
- While the citizens of Argentina debate politics, economics, and fiscal policy they do agree on wishing their team success in the World Cup. However, success on the pitch doesn’t mean the USD/ARS will suddenly change direction abruptly. Yes, Lionel Messi may be a god.
- The unofficial exchange rate being traded on the streets of Buenos Aires remains outlandishly different than the official exchange rate. Depending on the vendor it is common to see an exchange rate of about 300 USD/ARS now as the currency pair watches the Argentine Peso bleed value.
In political news yesterday, Fernandez de Kirchner was found guilty of corruption; she happens to be serving as Vice President of Argentina and was the leader of the country a handful of years ago. After the verdict which ‘suggests’ she should serve six years in prison and never hold public office again, she promptly spoke and alluded to her long-held claim that the decision was politically motivated.
Whether she ever serves a day in jail because of immunity laws for politicians holding office in Argentina remains to be seen. Simply put the decision may cause more political chaos, but this is nothing new for the nation. It certainly doesn’t help the value of the USD/ARS which suffers from a lack of transparent government and rather observable corruption which makes stated fiscal policy a running joke in Argentina.
If Speculators can buy the USD/ARS on a Trading Platform, Questions Remain for Them
While traders may believe buying the USD/ARS is a very simple way to make money, do not be fooled. Day traders if they are lucky enough to find the USD/ARS on a platform likely face transaction fees, overnight charges for holding the currency pair if the trade is prolonged, and the potential of large spreads regarding bid and ask before even stepping into the currency pair.
One option for speculators if the USD/ARS really can be pursued is to make the Forex trade by telephone if it is possible with your broker to guarantee a ‘price fill’. Then the waiting game must be played based on the hope the buying position doesn’t take too long to see upwards movement, because if the trade stagnates – carrying charges can prove costly. In other words, if you want to buy the USD/ARS and bet on upwards movement, you need deep pockets; patience, and the ability to get a solid price fill from your broker. Speculators who are trading the USD/ARS will not find an easy place to make living.
Argentine Peso Short-Term Outlook:
Current Resistance: 170.000
Current Support: 169.400
High Target: 172.000
Low Target: 169.100
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