USD/MXN Forecast Today - 22/08: USD Gains Vs MXN (Chart)
Date
8/22/2024 3:12:17 PM
(MENAFN- Daily Forex)
The US dollar has rallied a bit during the course of the trading session on Wednesday against the Mexican peso, but I think you've got a situation where traders will continue to see a lot of noisy behavior, and therefore I think you've got a situation where the US dollar is probably being favored for its safety over the Mexican peso as there are lot of issues out there that people will be worried about. With that being the case, I think you get a situation where it's a clear sign that despite the fact that the federal Reserve is likely to cut rates, the reality is that the world might be a bit concerned.
Technical Analysis
The technical analysis for the USD/MXN pair suggests that we do have further to go to the upside, but you also have to keep in mind that there has been a significant amount of resistance previously. With that being said, I think that it will be interesting to see if we can get to the 20 MXN level, as it has been important more than once. With that attitude, we will more likely than not continue to see a lot of volatility to the market, but I do think that short-term pullbacks will continue to be buying opportunities, especially near the 18.50 MXN level, which is where we see the 50-Day EMA.
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On the other hand, if the market were to break above the 20 MXN level, then I think we could go much higher. At that point in time, the market is likely to continue to truly rock it to the upside. In the meantime, I think it is more likely than not we continue to see a lot of back and forth, but each one of these moves could end up being opportunities to pick up value.
The size of the candlestick for the trading session on Tuesday and Wednesday are both impressive, and that tells me that people are starting to become a little bit nervous. Ultimately, I think this is a market that continues to go higher, but I also recognize that volatility is a feature, not a bug.
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