Bearish Scenario: Sales below 5220... Bullish Scenario: Buys above 5225 (if price fails to break below decisively) ...
USD/MXN: another wave down
2021-01-25 • Updated
Impression
Have a look at this layout: USD/MXN crossed all the MAs to reach 20.00. Looks spectacular to suggest a tactical trend change, doesn't it? Well, most probably it's not. As we pointed out in the previous article on exotics (https://bit.ly/2Yaufc5), these currencies are notably volatile and weak against the USD, that's why fluctuations such as the one you see here are pretty normal. Besides, it was recently announced that Mexican President Lopez Obrador got infected with the virus - that's a plausible reason for a national currency to temporarily get emotional and lose some value. Strategically, if you look at the daily and weekly charts, you'll see that there is still a lot of room to the downside before USD/MXN should be expected to take on its normal upward trajectory.
Trade tactics
Therefore, tactically, the expectation is that USD/MXN goes down to 19.55 crossing all the MAs downwards.
For the first downward wave (1), 19.65-19.70 seems to be an appropriate Take Profit level to set if you open a Sell position while USD/MXN is around 19.90.
Down there, at 19.70, once and if you see a local bullish reversal after a drop, re-group and prepare for another wave downwards (2) to break the support of 19.55.
The MAs are very convenient orientation and reversal references.
Similar
Bearish Scenario: Sell below 39600... Anticipated Bullish Scenario: Intraday buys above 39750... Bullish Scenario after Retracement: Intraday buys above 39150
Bearish scenario: Shorts below 18100 with TP1: 17900... Anticipated bullish scenario: Intraday Longs above 18130 with TP...
Latest news
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
Bearish scenario: Sell below 2200 / 2194 ... Nearest bullish scenario: Buy above 2197... Bullish scenario after retracement: Consider buys around each indicated demand zone
During the Asian session on Wednesday, the USD/CAD pair rebounded after two days of losses, reaching around 1.3590. This uptick is fueled by a stronger US dollar and lower crude oil prices, which put pressure on the Canadian dollar. The decline in Western Texas Intermediate (WTI) oil prices to approximately $80.70 is attributed to...