The USD/MXN is near the 18.88000 mark in early trading this morning, after providing day traders with choppy conditions, a lot of speculative noise based on news, a fairly known trading realm remains.
For all of the noise seen in the USD/MXN because of tariff news, Federal Reserve considerations, and U.S jobs numbers the currency pair has done remarkably well and remains in a known trading range. Yes, conditions have been fast and provided the specter of volatility for speculators who have not been using proper risk management. However, the USD/MXN as of this writing is near the 18.88000 level this morning and that is a result most financial institutions may be pleased about when considering the alternatives.
The USD/MXN traded near a low around the 18.69890 mark on early Wednesday of last week, then in the wake of Jerome Powell saying once again the U.S Federal Reserve remains in a wait and see framework regarding interest rates, the USD/MXN climbed to around the 18.88000 level late Wednesday. Yes, that is the same mark the currency pair is essentially trading now. Reversals, velocity and bumps and bruises were likely suffered by day traders during the volatile mix. Then by early Friday the USD/MXN had climbed to slightly above 18.98000.
Move Downwards Develops in the USD/MXN
While tariff news simmered internationally, it is unlikely financial houses were too concerned with the noise from headlines looking for attention and trying to create fear, instead big players early on Friday remained focused on a lack of interest rate clarity from the Fed and the approaching U.S jobs numbers. But something unexpected then happened, the U.S employment numbers came in below anticipated results and the USD turned weaker. A low around the 18.75350 level was produced.
While day traders try to decipher the gyrations in the USD/MXN, it may be best to simply look at the current trading range and accept the currency pair remains in a rather calm range. The highs and lows of the USD/MXN were not earth shattering, yes the forex pair moved quickly, but support and resistance levels remained durable.
USD/MXN Prospects Today and Tomorrow
Financial institutions may be expressing optimistic attitudes that believe the Fed is now in a position in which they will have to act. The USD/MXN traded within lower realms in late July.
- Betting on the 18.50000 realm to reemerge in the near-term is likely too ambitious, but there is reason to suspect the 18.80000 mark could be a legitimate target.
- Day traders are advised not to seek targets that are beyond their grasp regarding potential volatility while using leverage.
- Traders looking for lower levels without deep pockets are advised to cash out winnings before they vanish into thin air.
- The USD/MXN is likely to remain choppy near-term, but looking for slightly lower terrain appears potentially attractive.
USD/MXN Short Term Outlook:
Current Resistance: 18.88900
Current Support: 18.86010
High Target: 18.92600
Low Target: 18.81400
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