USD/MXN Analysis 08/09: Mixed Results

(MENAFN- Daily Forex) The USD/MXN has seen rather consistent price action between the 18.90000 level as resistance and the 18.50000 mark as support since the first week of July. Yes, there are definite outliers technically that have happened, but the rather tight realm in the USD/MXN is quite interesting from a speculative point of view.

While the USD/MXN certainly reacted to the weaker than expected jobs numbers this past Friday with selling. Lows around 18.58500 quickly vanished and a reversal higher was produced. Financial institutions dealing with the USD/MXN have created a rather tight price range and seem rather unready to venture outside of its boundaries. The U.S Federal Reserve and its interest rate policy will certainly factor into the currency pair, but the tight range which already exists, suggests financial institutions enjoy the current price equilibrium.

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While the USD/MXN is correlating to the broad Forex market, there is evidence that risk premium factors which certainly have been seen over the past year have largely been discounted. The USD/MXN around its current value seems to be almost tranquil. While the U.S jobs number reports caused fast selling on Friday, the lows didn't challenge prices at deeper depths seen in the previous weeks.

Support levels in the USD/MXN certainly look tempting, but there appears to be a durable value near the 18.56000 to 18.58000 ratios which are causing reversals higher when they are spotted technically. Day traders may want to continue to try and venture forward with selling positions when resistance is hit technically above, but it is advised for the moment not to rely upon lower targets beyond known support for the moment Higher Considered in the USD/MXN

Also noteworthy from a speculative point of view is that the reversal higher in the USD/MXN which occurred after support was proven strong on Friday has been sustained. The ability of the USD/MXN to traverse near the 18.70000 early this morning may be a waring sign that financial institution remain cautious and want to see more impetus develop for the currency pair to create another downwards rush.

• Until then it appears speculators who want to wager on the rather tight price realm of the USD/MXN could be proven right.
• Consolidated values do have a habit of producing break outs.
• But perhaps the discounting of risk premium which had been factored into the USD/MXN, has brought the currency pair close to a ratio some financial houses feel is within oversold territory when support below is touched.
• Opportunistic conditions in the USD/MXN look set to remain steady for technical traders near-term.

EURUSD Chart by TradingViewUSD/MXN Short Term Outlook:

Current Resistance: 18.70040

Current Support: 18.68700

High Target: 18.73800

Low Target: 18.64100

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