The decline in global equity markets these past couple of weeks has most certainly helped USD/MXN which recorded a new all-time high on Wednesday. Sentiment is getting a little bit too negative on MXN for my liking and I am starting to wonder if a counter-trend move of some magnitude is around the corner? In USD/MXN, I foresee an important resistance test ahead around 18.7500 as this marks the top end of a trend channel drawn from the 1998 and 2009 extremes. An overshoot of this resistance would not surprise, but I don’t like pressing this early in the year and will be looking to exit the remaining short position from last month around today’s IMM close. I may look to re-enter after a correction.
Long ½ position in USD/MXN from around 17.1400. Looking to take profit on remaining position ahead of today’s IMM close.
