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USD/MXN hits three-day highs at 17.70 driven by dollar strength

  • USD/MXN hits weekly highs at 17.70 on Wednesday.
  • The Dollar Index soars to 11-week highs at 104.63.
  • The focus will be on the speeches of various members of the Fed.

USD/MXN has gained ground for the second day in a row this Wednesday, rising at the European open to 17.70, new three-day high. The pair momentarily lost traction, retreating to a daily low of 17.64, but at time of writing is again approaching daily highs.

He Dollar Index (DXY) He continues to show his strength. The green ticket has reached the area in the European morning 104.63, its highest level since last March 16. Fears about the endorsement of the US debt limit bill have favored a risk averse climate in the markets that favors the dollar as a safe haven.

The operators of the pair will be awaiting the sentiment of the markets and the statements of several members of the US Federal Reserve, which could give more clues about the possibility of a pause or a new rate hike by the entity at the meeting of June. Michelle Bowman, Catherine Mann, Patrick Harker and Philip Jefferson will all be in the spotlight before attention turns to US ADP private employment numbers and the ISM manufacturing PMI tomorrow Thursday.

USD/MXN Levels

With the pair trading at time of writing above 17.68, gaining 0.17%, the first resistance to overcome is at the daily high. 17.70 before 17.87, ceiling of May 25. A jump above this level would point to the region 17.99/18.00, maximum of May 23 and psychological figure, respectively. A clear break above this area will point to 18.20maximum of April 27.

To the downside, we see a support zone at 17.53/54, where the minimums of May 29 and 30 are. A break of these levels could send the pair towards 14.42, seven-year minimum reached on May 15. Below that, the USD/MXN could fall to 17.10floor of March 31, 2016, and subsequently to 17.00important psychological area.

Source: Fx Street

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