The start to Forex trading in the USD/MXN this week is beginning as Europe and the U.S observe holidays. However, early selling has been seen in the USD/MXN as the currency pair correlates to early price action. USD centric weakness getting plenty of attention as a positive wave of sentiment has created risk appetite. The USD/MXN is near the 17.28035 ratio with fast changes and a wide spread.
A thrust of quick selling emerged when Asian markets opened this morning and allowed financial institutions to make quick bets and take advantage of shifting dynamics in Forex. The USD/MXN renewed bearish momentum and opened with a gap lower, which also took place among other major currencies teamed against the USD. Talk about a possible agreement between the U.S and Iran has created positive energy in the global markets across assets.
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Early Results and Questionable Volume
Before day traders jump blindly into Forex positions today they need to acknowledge that volumes will be extremely light because of major banking holidays in Europe and North America. The initial wave downwards in the USD/MXN has seen a slight reversal higher, but the currency pair does remain within the lower elements of its near-term range.
Bearish trading has been in effect for the USD/MXN since last Wednesday’s highs around the 17.42800. Yes, as always there have been reversals upwards speculators have had to be wary about, but the USD/MXN has been able to maintain a rather firm trend lower over the long-term. This weekend’s developing storyline about the prospect of a U.S and Iranian resolution might fuel additional thoughts about a lower USD/MXN.
Near-Term and Potential USD/MXN Volatility
Speculators may choose not to trade until Tuesday because of light holiday Forex volumes today. The move lower upon the Asian markets opening today for the USD/MXN were easy to predict, but what happens in the coming hours will be tricky as many financial institutions do not participate today.
News regarding the negotiations between the U.S and Iran will certainly continue to shift emotions going forward over the next twenty-four hours.
Selling in the USD/MXN and its burst below 17.24000 this morning are intriguing, but support (and a lack of volume) have resulted in headwinds.
The USD/MXN in fact traded at lower values throughout the second week of May.
This morning’s results tested last week’s lows, but bigger targets will be considered by financial institution if the U.S and Iran news continues to be seen as positive.
USD/MXN Short Term Outlook:
Current Resistance: 17.29800
Current Support: 17.27625
High Target: 17.30700
Low Target: 17.24500