The USD/MXN has traded sideways early this morning, but this has occurred after a selloff was demonstrated on Friday before going into the weekend.
- The USD/MXN exchange rate is trading near the 18.30085 mark early today, on Friday the currency pair hit an apex around the18.60000 vicinity which was a value last seen on the 17th of June.
- The USD/MXN is still maintaining rather higher nervous realms as financial institutions are confronted by a change to behavioral sentiment due to a more aggressive sounding Morena political party in Mexico.
- The selloff on Friday before going into the weekend however did show that many thought the USD/MXN had been overbought.
The higher realms of the USD/MXN being displayed can be seen via one week and the past month’s trading technically. The 18.30000 vicinity was seen towards the end of the first week of June and although movement upwards has been attained via choppy conditions, the ability of the USD/MXN to create equilibrium around this level may prove to be testing ground in the days ahead.
USD/MXN Economic Data and the U.S Holiday
The U.S has continued to turn in rather mixed economic data and the Federal Reserve although outwardly cautious may be leaning towards the notion of interest rate cuts. However, even if the Fed chooses to cut the Federal Funds Rate the moves will likely be at a snail pace. The USD/MXN may need to fight its way through its current price ratios via behavioral sentiment that is unlikely to see a great amount of change via impetus. Technical traders may feel current support and resistance levels provide adequate targets for quick hitting wagers with the currency pair.
Traders also have to know the U.S will celebrate its Independence Day holiday on the 4th, meaning that Forex volumes will become very light on Wednesday and the last two days of this week will be extremely thin regarding volume for the USD/MXN. Traders who choose to participate should be careful as of Wednesday and be on the lookout for potential sudden spikes later this week.
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Short-Term Sentiment in the USD/MXN
The 1.30000 ratio may prove important as a lynchpin today and tomorrow in the USD/MXN. Having seen higher ratios last Wednesday through Friday some traders may be tempted to look for additional upside at the current price levels. However, traders are encouraged to remain conservative.
- The question for speculators is just how far the USD/MXN can climb and what depth can it drop to in the coming days.
- The potential exist that the current price level of the USD/MXN may provide a solid range that can be tested today and tomorrow.
- The 18.24000 to 18.44000 range looks technically intriguing.
USD/MXN Short Term Outlook:
Current Resistance: 18.34290
Current Support: 18.28870
High Target: 18.41900
Low Target: 18.23700
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