The US dollar fell against the Mexican peso during trading on Wednesday as the 50 day EMA has offered quite a bit of resistance and it looks like the market is going to continue to see that downward trend play out.
But that being said that doesn't mean we go straight down and in fact I suspect that we get a small bounce from here in the next day or 2 that we can take advantage of to start shorting again.
While you do get paid to hold the USD/MXN pair to the downside the reality is that it will bounce from time to time and therefore you still have to be careful especially considering that the spread is fairly wide between the US dollar and the Mexican peso as it is an exotic currency pair it has to be traded a little bit differently.
Top Regulated Brokers
Testing Technical Levels
It's not necessarily a short-term day trading opportunity that you get very often but when you test certain moving averages and technical levels it does make a certain amount of sense to take advantage of that. The bounce that we get from here be it the next day or 2 or a week later is still for me a potential selling opportunity closer to the 17.45 level.
If we break down from here the 17.20 level has offered support with the 17-level underneath there offering even more support, be it psychological or structural based on historical pricing.
Nonetheless I do like the Mexican peso as long as the US economy does fairly well because quite frankly the US economy is what drives the Mexican economy as Mexico is the largest exporter into the United States. I have no interest in buying this pair I can't be bothered to pay the swap and that's a long-standing tradition of mine I almost never buy the dollar against the peso because if I want to own the dollar, I can actually get paid to own the dollar against other currencies.
Ready to trade our Forex daily analysis and predictions? Here are the best forex brokers in Mexico to choose from.