The price of the Dollar falls below 17.15 against the Mexican Peso one day after the Fed

• USD/MXN has fallen to a daily low of 17.07 in the Tuesday session.
• The price of the Dollar falls to a three-day low near 104.80.
• The market is agitated one day after the Federal Reserve’s monetary policy announcement.

USD/MXN reached three-day highs at 17.18 at the start of the American session on Monday. Subsequently, the pair began to give ground, extending its decline to 17.07, Tuesday’s daily low.

The price of the dollar loses strength

He Dollar Index (DXY) It fell this Tuesday from the 105.20 region to 104.81, a new three-day low. The market turmoil one day after the Fed’s announcement does not favor the greenback, which still manages to recover the 105.00 region at the American opening.

The United States Federal Reserve holds its monetary policy meeting between Tuesday and Wednesday, announcing its decision on rates tomorrow the 20th at 18:00 GMT. One day after the announcement, the FedWatch tool gives a 99% probability that the Fed will keep rates unchanged. For the November meeting, the chances of a rate increase have fallen from yesterday’s 30.7% to 28.8%, while for December this possibility stands at 35.4%, down from yesterday’s 36.8%.

Read: Federal Reserve Preview: Powell will push the dollar higher with a hawkish tone

Regarding Mexico, the Timely Indicator of Economic Activity (IOAE) estimated that the country grew 3.4% year-on-year in August, as published by INEGI. On the other hand, yesterday it was known that private consumption registered an annual growth of 4.3% in the second quarter of the year.

USD/MXN Price Levels

With USD/MXN trading at the time of writing above 17.10, down 0.15% on the day, a break of today’s low at 17.07 would lead directly to the psychological level of 17.00. A break of this zone could cause a strong downward movement towards 16.62a minimum of almost eight years recorded on July 28.

To the upside, there is an initial resistance zone at 17.18/17.20, highs from September 18 and 14, respectively. Above this region, the pair can advance towards 17.40, the former barrier to the upside. Higher up, the Dollar can shoot up against the Mexican Peso up to 17.70, the ceiling of September 7 and the last three and a half months.