Don’t waste your time – keep track of how NFP affects the US dollar!

Data Collection Notice

We maintain a record of your data to run this website. By clicking the button, you agree to our Privacy Policy.

facebook logo with graphic

Join Us on Facebook

Stay on top of company updates, trading news, and so much more!

Thanks, I already follow your page!
forex book graphic

Beginner Forex Book

Your ultimate guide through the world of trading.

Get Forex Book

Check Your Inbox!

In our email, you will find the Forex 101 book. Just tap the button to get it!

FBS Mobile Personal Area

market's logo FREE - On the App Store

Get

Risk warning: ᏟᖴᎠs are complex instruments and come with a high risk of losing money rapidly due to leverage.

69.21% of retail investor accounts lose money when trading ᏟᖴᎠs with this provider.

You should consider whether you understand how ᏟᖴᎠs work and whether you can afford to take the high risk of losing your money.

USD/MXN: retrocession

USD/MXN: retrocession

Information is not investment advice

Technical view

On the daily chart below we see a gradual – with the exception of May-June – descent of the USD against the MXN. As the crisis kicked in, USD/MXN leaped to 25.50 in March, and since then has been sliding down. Currently, it trades below 21.40 flirting with June low and appearing pretty serious to cross it. Down below, we have 21.00 – that’s still within the downtrend if the price keeps the same pace.

1.png

In the meantime, a long-term view shows that even lower zones may be possibly targeted by USD/MXN – if it crosses 21.00 downwards. The support of 20.00 seems to be the most probable destination in the midterm. However, it is still in the upper zone of the trend projection (marked “1”) if we remove the Feb-Aug virus distortion. Everything below the 100-MA and especially 200-MA is also a very possible destination (marked “2”) but this will take longer to reveal. First, we have the key support of 20.00 and the 50-MA to check the bearish potential.

2.png

Fundamental view

The Mexican peso is weak because the Mexican economy is weak – relative to the American. In a stable outside environment, however, this weakness is stable and transformed into a gradual rise with intermittent periods of sideways movement – you can see it in the monthly chart below. But when a crisis hits, the background field gets disproportionately distorted, and the peso can no longer sustain all the pressure – and falls. That’s why we see spikes like this in USD/MXN every time there is a serious global or regional crisis: such as the current one, and as in 2008. After that, it comes back to normal sluggish ascension – which is what’s happening now. Getting back to normal. In this sense, going down to 20.00 appears as a natural, expected and even a duly event with USD/MXN. There are other factors for it: the USD is also trembling on the US-China bumps and Pre-election tensions. In the meantime, the MXN may get stronger on international companies moving their facilities from China to Mexico due to the said tensions. Therefore, keep watching the key levels of 21.00 and 20.00 and follow the trends with us!

3.png

                                                                                                 LOG IN

Similar

Popular

How Will BoJ Meeting Affect the Yen

Hold onto your hats, folks! The Japanese yen took a nosedive after the Bank of Japan (BOJ) left its ultra-loose policy settings unchanged, including its closely watched yield curve control (YCC) policy. But wait, there's more! The BOJ also removed its forward guidance, which had previously pledged to keep interest rates at current or lower levels. So, what's the scoop? Market expectations had been subdued going into the meeting, but some were still hoping for tweaks to the forward guidance to prepare for an eventual exit from the bank's massive stimulus

Choose your payment system

Callback

Please fill in the form below so we can contact you

Select the best time for us to call you. We give calls from Monday to Friday in suggested intervals. In case we couldn't get through, we will try again at the same time the next day. For getting real-time assistance, use FBS chat.

We provide only English-speaking callbacks. If you prefer any other languages, contact the support team.

We will call you at the time interval that you chose

Change number

Your request is accepted.

We will call you at the time interval that you chose

Next callback request for this phone number will be available in 00:30:00

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later