The USD/MXN has fought once again below the 17.00000 price level and Friday’s price action produced depths not seen since the middle of April.
- As of this writing the USD/MXN is trading near the 16.94820 ratio as the currency pair has been able to sustain momentum below the 17.00000 level.
- Sentiment in global Forex has produced a weaker USD recently and financial institutions reacted to Friday weaker than anticipated U.S jobs numbers with more selling pressure.
- The USD/MXN touched a low around 16.83000 on Friday in the midst of strong selling momentum.
While the lower depth was not able to be maintained, the reversal higher has been polite and the broad Forex market has also sustained a weaker USD centric stance today. Bearish momentum in the USD/MXN has been a solid factor over the long-term and the move above the 17.0000 which touched a high of around the 17.52000 mark (excluding the temporary spike caused by Middle East conflict concerns which touched the 18.16000 ratio) on the 19th of April has once again seen value turn lower.
USD/MXN and Support Levels as Sentiment Shifts
Bearish traders of the USD/MXN will certainly have their eyes on lower depths for the currency pair. On the 9th of April the USD/MXN traded around the 16.26250 level. Forex has been volatile over the past four months and this may continue still. However, recent U.S data may have started to create a shift once again in behavioral sentient regarding economic outlook and what the Federal Reserve will be able to do moving forward.
While inflation remains troubling in the U.S, last week’s weaker than expected earnings numbers may make financial institutions lean towards a weaker USD outlook. Now that the 17.00000 level in the USD/MXN has been proven vulnerable again and price action has been able to be kept below this mark, bearish traders may believe sentiment can take the USD/MXN back to known levels below.
Short-Term USD/MXN Bets
There will not be a lot of U.S economic data until later this week. Traders should keep their eyes on U.S Treasury yields; if these numbers stay muted through Wednesday and begin to decline it will likely help the USD become weaker.
- If the 16.91000 level is broken lower and sustained in the near term it would likely ignite more selling optimism for the USD/MXN.
- However traders should keep in mind the rather messy results produced in the broad Forex market the past 4 months full of reversals.
- Momentum lower might be wagered on, but sustainability is still more of a hope at this juncture as the Federal Reserve outlook still remains unclear for the mid-term.
USD/MXN Short Term Outlook:
Current Resistance: 16.95100
Current Support: 16.93010
High Target: 16.97500
Low Target: 16.89200
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