The US dollar-Mexican peso currency pair is holding onto slight losses near the day’s lowest level, after putting an end to a four-week decline. The USDMXN is trading at 17.1353.

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for FREE REGISTER to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level1)]

• USD/MXN clings to mild losses around intraday low after snapping four-week downtrend.

The pair currently trades last at 17.1353.

The previous day high was 17.2656 while the previous day low was 17.1367. The daily 38.2% Fib levels comes at 17.186, expected to provide resistance. Similarly, the daily 61.8% fib level is at 17.2164, expected to provide resistance.

USD/MXN remains on the back foot around 17.14-15 as it pares the biggest weekly gains in five amid Monday’s sluggish Asian session. In doing so, the Mexican Peso (MXN) pair cheers broad US Dollar pullback amid mildly positive sentiment. However, a lack of major data from Mexico and a cautious mood ahead of this week’s top-tier US inflation clues, as well as central bankers’ speeches, challenge the pair sellers.

Market sentiment improves after the weekend news raised doubts about Russian President Vladimir Putin’s power in Moscow and hopes of major stimulus from China allowed trades to witness cautious optimism and weighed on the US Dollar. “Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin’s grip on power,” said Reuters in this regard.

Additionally, Ning Jizhe, deputy head of the economic committee of the Chinese People’s Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC) flagged concerns about sooner stimulus from China and allowed the USD/MXN to drop. “China needs to step up measures as soon as possible to bolster a faltering post-COVID recovery in the world’s second-largest economy,” said China’s Ning Jizhe per Reuters.

Even so, the Banxico inaction versus the Fed’s hawkish signals, as well as upbeat US PMIs, challenge the USD/MXN bears.

That said, the central bank of Mexico (Banxico) kept its benchmark rate unchanged the last week while the Fed policymakers appear hawkish after witnessing upbeat data at home.

On Friday, US S&P Global PMIs for June came in mixed as the Manufacturing PMI dropped to 46.3 from 48.4 prior, versus 48.5 expected, whereas the Services PMI improved to 54.1 from 54.0 expected despite being lesser than the 54.9 previous monthly figure. With this, the Composite PMI declined to 53.0 versus 54.4 market forecasts and 54.3 prior.

Following the mixed US PMIs, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said, “Any further rate hikes will of course have a further dampening effect on this sector (services) which is especially susceptible to changes in borrowing costs.” That said, Federal Reserve Bank of San Francisco President Mary Daly told Reuters on Friday that two more interest rate increases this year would be a “very reasonable projection.”

Moving on, the risk-positive headlines from China and Russia can weigh on the USD/MXN price for intraday. However, the US Dollar bulls remain hopeful unless witnessing a clear rejection of the risk aversion from the US inflation numbers and speeches of the top-tier central bankers at the European Central Bank (ECB) Forum, as well as the US Bank Stress Test results.

Friday’s Doji joins a downside break of a one-week-old ascending support line, around 17.16 by the press time, to keep the USD/MXN bears hopeful.

Technical Levels: Supports and Resistances

USDMXN currently trading at 17.1448 at the time of writing. Pair opened at 17.1791 and is trading with a change of -0.20% % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 17.3255, 50 SMA 17.6375, 100 SMA @ 18.0195 and 200 SMA @ 18.776.

The previous day high was 17.2656 while the previous day low was 17.1367. The daily 38.2% Fib levels comes at 17.186, expected to provide resistance. Similarly, the daily 61.8% fib level is at 17.2164, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 17.122, 17.0649, 16.9932
• Pivot resistance is noted at 17.2509, 17.3227, 17.3798

[/s2If]
Nehcap Expert Advisor
The NEHCAP MT4 EA is high quality professional trading system geared to generate returns without using GRID or martingales. Each trade has strict risk per trade parameter. The pairs under management include EURUSD, GBPUSD, AUDCAD, AUDNZD,GBPAUD, EURAUD, EURCAD, CHFJPY and many more.
The system is trading live: LIVE ACCOUNT TRACKING
You can run it free. Apply for a free trial and track our account. Buy the system or use profit share mechanism to generate returns on your MT4.
Join Our Telegram Group