- USD/MXN has retreated to 17.90 from highs at 18.10 but is trading around 18.00 after the American open.
- The price of the Dollar has given ground after Friday’s 10-day highs.
- Amid tensions in the Middle East, the focus will be on US retail sales due to be released this Tuesday.
The USD/MXN began the week testing the six-day high reached last Friday at 18.10, but subsequently lost ground until falling to 17.90 at European midday. After the opening of Wall Street, the pair has returned to the vicinity of $18, trading at 17.97, losing 0.65% daily.
Dollar price loses momentum ahead of US retail sales
The Dollar Index (DXY) reached the 106.78 zone on Friday, the highest of the last ten days. The greenback lost momentum this Monday, sliding towards the 106.33 area, a new daily low, but after the opening of the US session it has regained some ground.
Pending the important US retail sales data for the month of September that will be published tomorrow and that could give new direction to the Dollar, today the New York Empire manufacturing index was published. The indicator has fallen nearly seven points in the October reading, plummeting from +1.9 to -4.6, its lowest level in two months. The result improves, however, the -7 points expected by the market consensus.
US retail sales are expected to grow 0.3% in September, down from 0.6% in August. The indicator could give clues to rule out or ensure a final Fed rate hike before the end of the year. The FedWatch tool today gives only 9.9% options for a rate increase in the November meeting, while in the December meeting that percentage rises to 31.3%.
USD/MXN Price Levels
If it regains momentum, the USD/MXN will find resistance in the 18.10 zone, the ceiling of October 13 and 16. Higher up there is an intermediate barrier at 18.30, the high of October 10, prior to an attempt to overcome the 18.49/50 area, the highest level so far this month recorded on October 6.
On the downside, 17.75 is the first support (weekly low recorded on October 12). A break below would target 17.60, the October 3 floor. In case of a break of this last level, the objective will be at 17.35, the lowest level of September 29, prior to 16.99/17.00, the minimum of September 20 and psychological zone, respectively.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
