News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bearish
Wall Street
Mixed
Gold
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • What are some key points post the US Presidential debate? Get your key highlights here with @ZabelinDimitri at 10:30PM EST here: https://t.co/XV0y5M8KLT https://t.co/PUTq6kOjxt
  • Although recent polls suggested that Joe Biden is leading, the odds that Donald Trump may again defy the preconceived forecasts still exist. Remember he is Trump. And thus a face-to-face debate is worth traders’ precious time. Live TV show begins in 50 mins.
  • Dow displayed a bearish trading pattern overnight: 7 out of 9 sectors in the red, with 86.7% of the index constituents ending lower. Energy, materials and industrials were among the worst performers, while healthcare and consumer discretionary struggled to hold small gains. https://t.co/hI957NZRLr
  • 🇯🇵 Industrial Production YoY Prel (AUG) Actual: -13.3% Previous: -15.5% https://www.dailyfx.com/economic-calendar#2020-09-29
  • 🇳🇿 ANZ Business Confidence (SEP) Actual: -28.5 Previous: -41.8 https://www.dailyfx.com/economic-calendar#2020-09-30
  • 🇯🇵 Retail Sales YoY (AUG) Actual: -1.9% Expected: -3.5% Previous: -2.8% https://www.dailyfx.com/economic-calendar#2020-09-29
  • Heads Up:🇳🇿 ANZ Business Confidence (SEP) due at 00:00 GMT (15min) Previous: -41.8 https://www.dailyfx.com/economic-calendar#2020-09-30
  • Heads Up:🇯🇵 Industrial Production YoY Prel (AUG) due at 23:50 GMT (15min) Previous: -15.5% https://www.dailyfx.com/economic-calendar#2020-09-29
  • Heads Up:🇯🇵 Retail Sales YoY (AUG) due at 23:50 GMT (15min) Expected: -3.5% Previous: -2.8% https://www.dailyfx.com/economic-calendar#2020-09-29
  • The British Pound and US Dollar will be contending with the rising geopolitical risks of Brexit, US fiscal stimulus talks and the first presidential debate in a data-packed week. Get your $GBPUSD market update from @ZabelinDimitri here:https://t.co/iXDA9cVqtd https://t.co/2iiyWMXFTA
USD/MXN Forecast: Dollar-Peso Probes Key Level as Oil Swings

USD/MXN Forecast: Dollar-Peso Probes Key Level as Oil Swings

2020-08-31 21:25:00
Rich Dvorak, Analyst
Share:

USD/MXN PRICE OUTLOOK: DOLLAR-PESO SEARCHES FOR SUPPORT AS CRUDE OIL PULLS BACK

  • USD/MXN price action is gyrating around its 200-day moving average
  • US Dollar searches desperately for support as commodity currencies strengthen
  • Mexican Peso could come under pressure if there is a resurgence of volatility

USD/MXN prices have edged steadily lower over the last couple months. This comes as the US Dollar surrenders gains notched against the Mexican Peso – and other commodity currencies like the Canadian Dollar, Norwegian Krone, or Australian Dollar – earlier this year during the onset of the coronavirus pandemic. Yet, despite weakening over 10% since March, the Dollar-Peso still trades higher by more than 15% when measured from its January opening level.

Forex for Beginners
Forex for Beginners
Recommended by Rich Dvorak
Forex for Beginners
Get My Guide

USD/MXN PRICE CHART: DAILY TIME FRAME (19 MAR TO 31 AUG 2020)

USDMXN Price Chart USD MXN US Dollar to Mexican Peso Forecast

Net of these moves, spot USD/MXN price action now gravitates slightly below its 200-day moving average, which resides near the 21.900-mark. That said, after breaching this key technical level late last week, the US Dollar appears vulnerable to another leg lower against the Mexican Peso. If USD/MXN bulls can reclaim this barrier, however, it could encourage them to target the 50-day moving average or 23.6% Fibonacci retracement level outlined on the chart above. On the other hand, if the bearish medium-term trend prevails, the 08 June swing low could serve as a potential downside objective for USD/MXN bears.

Traits of Successful Traders
Traits of Successful Traders
Recommended by Rich Dvorak
Traits of Successful Traders
Get My Guide

USD/MXN PRICE CHART & CRUDE OIL OVERLAID: DAILY TIME FRAME (27 MAY TO 31 AUG 2020)

USDMXN Price Chart US Dollar to Mexican Peso Correlation with Crude Oil

Perhaps the direction of crude oil could indicate where spot USD/MXN price action heads next. The Dollar-Peso tends to holds a strong inverse relationship with crude oil price action, which is indicated by the negative correlation coefficient generally maintained. The Mexican Peso is closely tied to fluctuations in oil prices seeing that Mexico is one of the world’s largest producers and exporters of crude oil. Also, the relationship between crude oil and USD/MXN is similar to the relationship between crude oil and USD/CAD.

Understanding the Core Fundamentals of Oil Trading
Understanding the Core Fundamentals of Oil Trading
Recommended by Rich Dvorak
Understanding the Core Fundamentals of Oil Trading
Get My Guide

Correspondingly, there is potential for USD/MXN prices to continue drifting lower while the global economy sustains its recovery and crude oil advances further. This brings the release of PMIs and jobs data throughout the week into focus for a health check on underlying economic conditions. On that note, it is worth mentioning how a resurgence of market volatility and risk aversion likely stands to send USD/MXN price action snapping back higher.

Learn More: Register to Attend the DailyFX Education Summit Online for Free!

-- Written by Rich Dvorak, Analyst for DailyFX.com

Connect with @RichDvorakFX on Twitter for real-time market insight

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES