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U.S. Dollar / Mexican Peso

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USDMXN trade ideas

Fed vs. Banxico: USD/MXN forecast The US Federal Reserve (Fed) is set to announce its decision on Wednesday, followed by the Bank of Mexico (Banxico) on Thursday. Forecasts suggest that both central banks will maintain their current interest rates. Recent indications from Banxico suggest a leaning towards a more accommodative monetary policy. However, Deputy Governor Irene Espinosa has expressed reservations, highlighting the persistence and escalation of inflationary risks. Analyzing the USD/MXN chart reveals an upward momentum, with the pair converging between the 200-day Simple Moving Average (SMA) and the 50-day SMA at 17.40. The reclaiming of the psychological level of 17.50 could be a crucial factor in confirming this momentum. If the USD/MXN experiences a decline, the 100-day SMA may serve as a noteworthy level before reaching support at 17.00/05. Economists at Rabobank project USD/MXN to average around 17.20 in the next month. They expect the pair to trade around this level in early 2024 before potentially rising to the 17.80 region by the end of the first quarter.
by BlackBull_Markets
2
Elliott Waves Suggests USDMXN Can Be A Nice ShortHey folks, In this article, I’ll give you an update on USDMXN, which we’ve talked about before. You probably noticed that the Mexican Peso (MXN) has been quite strong for the past couple of years, mainly because of higher interest rates compared to other places, USDMXN short was a good carry trade. However, things have started to shift a bit recently. Inflation in the US went up a bit due to rising energy costs, and some folks thought the Federal Reserve (FED) might keep a tough stance (hawkish) on monetary policy. This pushed the US Dollar higher along with yields. But now, there’s a new element in the mix – the geopolitical tension between Hamas and Israel. This situation can make the markets super jumpy and volatile. I’m not so sure if the FED can keep its hawkish stance in such a shaky environment. Keep in mind, during a conflict or war, a government might ease up on its tough policies to fund the war effort and get cheap financing. So, I’m wondering if it might be the right time to expect USDMXN to continue its downward trend. In fact, the pair has dropped this week, especially after markets opened with some gaps in various assets. From an Elliott Wave point of view, we can see a decent corrective rise from recent lows, a clear fourth wave move up to the 38.2% Fibonacci resistance. We’re seeing a turnaround from there, and if we break key rising trendline, more bears could join the party. This makes sense since the overall trend is still bearish as long as the price stays below the 2022 trendline resistance. So, I think a fifth wave down might be just around the corner, and it could happen quite quickly, especially if the US Dollar’s trend changes, which is possible if stocks would stay in risk-on mode till end of the week.
Short
by ew-forecast
Broken Trendline Keeps USDMXN In Downtrend For Wave 5Broken Trendline Keeps USDMXN In Downtrend For Wave 5 from technical point of view and by Elliott wave theory. USDMXN shorts are doing very well as we mentioned and highlighted on October 12, when we spotted a corrective recovery in wave (4). As you can see today, USDMXN turned nicely down from projected resistance and it can be headed much lower as bulls failed to break above the daily trendline resistance in October. So this was seen as a corrective and temporary bounce; wave (4), which puts wave (5) in action after broken trendline support, so weakness is ready to resume, ideally down to 16.00.
Short
by ew-forecast
4