- Stocks fall more than 2% on average in the US for the second day in a row.
- Inflation in the US hits new highs since 1981.
- USD/MXN breaks key resistances, points to more gains.
USD/MXN soared on Friday after US inflation data and against a backdrop of sharp declines in equity markets, which is driving the dollar across the market. The pair climbed to 19.85, reaching the highest level since May 26.
After the start of the American session, the USD/MXN remains under strong upward pressure, the RSI points to the upside far from overbought and Momentum is about to break the 100 level, when the price broke the 20-day simple moving average for the first time. once in a month.
Should the rallies extend, the next strong resistance can be found around 19.90, which is the last protection for a return to 20.00. In the opposite direction, a return below 19.70 could ease the upside pressure.
The last upward impulse came after the US inflation data. which was above expectations and that pushed up Treasury yields sharply. In turn, the main Wall Street indices are falling sharply for the second day in a significant way. Bad weather weighs on emerging market currencies.
In Mexico, on Thursday it was known that the consumer price index rose 0.18% in May and that the annual rate stood at 7.65%, in the area of what was expected. In the US, the rise was 1%, and the annual rate reached 8.6%, it is the highest since December 1981.
Technical levels
Source: Fx Street
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