Mexican Peso is stable against US Dollar as US jobs data improves, but housing paints mixed outlook.

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• Mexican Peso is stable against US Dollar as US jobs data improves, but housing paints mixed outlook.
• Drop in US unemployment claims indicates the economy remains resilient, strengthening US Dollar.
• USD/MXN traders await further Fed speakers, Mexico’s Retail Sales on Friday.

The Mexican Peso (MXN) is virtually unchanged against the US Dollar (USD) after a tranche of mixed economic data from the United States (US) and traders paring rate cut bets on the Federal Reserve (Fed), which is keeping the Greenback (USD) bid across the board. The USD/MXN trades at 17.18 on the day after hitting a daily low of 17.15, up 0.07%, following a slide below the 50-day Simple Moving Average (SMA).

The US Bureau of Labor Statistics (BLS) revealed that unemployment claims for last week grew at a slower pace than the previous reading and expectations. The print portrays a tight labor market. Meanwhile, the US Department of Commerce (DoC) released Housing Starts and Building Permits data, which came in mixed, failing to keep the USD/MXN in positive territory. Ahead on Thursday, Atlanta Fed President Raphael Bostic’s comments will cross the newswires.

The USD/MXN daily chart remains neutral to upward biased, but failure to decisively break the 200-day SMA (Simple Moving Average) at 17.37 exacerbated a pullback below the 17.20 area. A breach of the 50-day SMA at 17.17 would pave the way to challenge the January 12 low of 16.82. Further downside is seen at the January 8 low of 16.78. Once those levels are hurdled, the next demand level would be the August 28 cycle low of 16.69, ahead of last year’s low of 16.62.

On the other hand, if buyers reclaim the 17.20 area, that could open the door to test the 200-day SMA at 17.37. Once surpassed, the next resistance emerges at the 100-day SMA at 17.41, ahead of the December 5 high at 17.56, before testing the May 23 high of 17.99.

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