[ad_1]
The USD/MXN climbed to higher values on Monday not seen since early January, but in the past twelve hours the currency pair has shown signs of perhaps being overbought.
The USD/MXN is trading near the 19.14600 realms as of this writing, but this comes after challenging the 19.29100 vicinities in a bull rush upwards yesterday. On Thursday of last week the USD/MXN was asserting strong bearish sentiment as it hit a low around 18.50700, this followed Wednesday’s U.S Federal Reserve interest rate hike and rhetoric regarding the U.S central bank needing to remain alert regarding potential causes for higher inflation reasserting.
Latin American currencies can give great price movements.
Trade them with our featured broker.
Trade Now !
Speculators who had enjoyed the long-term bearish sentiment in the USD/MXN however were likely, not pleased when the U.S Non-Farm Employment Change numbers came in with a strong surprise on Friday. Instead of showing slowing hiring, the jobs statistics demonstrated employers were still adding jobs. The USD/MXN promptly went higher and finished near the 18.94700 realms going into the weekend.
Yesterday’s USD/MXN Highs may be viewed as an Over Reaction by some Traders
Trading in the USD/MXN yesterday started with more buying and the day’s highs came within sight of lofty values, but perhaps the 19.30000 level acted as a psychological roadblock. The last time the USD/MXN has traded above the 19.30000 ratio was on the 5th of January. While buying certainly displayed a great deal of strength yesterday, a slight reversal did take place and the USD/MXN is near intriguing short-term support for the moment.
- The job numbers published by the U.S. are backward-looking, the strong hiring in the past month can be considered suspicious regarding an outlook.
- The swift buying in the USD/MXN may create a speculative price range for traders who believe the currency pair has been overbought.
- Short-term reversals may be sought by speculators who think support near the 19.13000 to 19.11000 ratios is a legitimate target.
Near-Term for USD/MXN likely to Produce Choppy Results
The USD/MXN has been within the grasp of a long-term bullish trend. The upwards momentum since last Friday may prove to be short-lived and the currency pair may resume its path lower again. However, the near term is likely to be choppy as financial houses try to find equilibrium and adjust their outlooks regarding U.S. Federal Reserve monetary policy. Another rate hike is considered likely in March in the U.S. central bank.
However, questions about inflation and employment in the U.S. will continue to factor into the USD/MXN. Speculators may want to target short-term resistance near the 19.18000 to 19.19000 levels and support near the 19.13000 as goals for taking profits and stopping losses if they want to bet on narrow targets. Speeches from U.S. Federal Reserve members today and into the week may stir behavioral sentiment as traders look for clarity. If clarity is not attained, the price range for the USD/MXN may be difficult.
USD/MXN Short-Term Outlook:
Current Resistance: 19.19300
Current Support: 19.11100
High Target: 19.27610
Low Target: 18.94700
[ad_2]