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Traders who have been pursuing constant bearish momentum from the USD/MXN have had their nerves tested since late July.
The USD/MXN as of this moment is near the 17.04500 level, last week at this moment the currency pair was also close to the same value. However, during the week that ensued, the USD/MXN moved swiftly upwards on Monday and Tuesday, reversed lower on Wednesday, but then produced solid buying and the week’s high on Thursday around the 17.20700 ratio. The USD/MXN then moved lower on Friday and finished the week again near lows again.
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In other words, if you were on vacation last week and didn’t watch the markets, and look at the current values of the USD/MXN now, you may be inclined to believe nothing happened at all in the currency pair. Except to say trading obviously took place and the nervous sentiment was strong, not only in the USD/MXN but all of Forex. The USD/MXN correlated to the global currency markets well.
Traders who have been pursuing constant bearish momentum from the USD/MXN have had their nerves tested since late July. However the upwards price action in the USD/MXN and the highs reached on the 3rd and 4th of August have not been sustained. The USD/MXN has shown a healthy dose of bearish strength actually. The ability of the USD/MXN to trade lower since last Thursday may be a signal additional lower price action could develop. However, traders should be cautious because last week’s start may have felt the same way for many traders who were bearish and got hit by upside momentum early.
The 17.00000 level is again in sight for traders and is a logical target for sellers of the USD/MXN in the short term. Traders need, however, to be cautious and not overly ambitious with their bearish perspectives. Risk-averse trading in the global markets remains heightened and financial houses are showing a lack of commitment to a chosen direction. Choppy conditions are happening in a widespread fashion.
- Traders may want to watch market price action early today to see if the USD/MXN continues to test the lower elements of its short-term range. If resistance levels above the 17.06000 to 17.08000 ratios prove durable, this could spark additional selling of the USD/MXN.
- The past week of trading was difficult for those pursuing downside price actions in the USD/MXN, and until behavioral sentiment turns slightly positive globally, speculators need to remain conservative with their wagers.
Current Resistance: 17.06400
Current Support: 17.01010
High Target: 17.10900
Low Target: 16.97500
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