- The Mexican peso remains firm against the dollar, despite a negative climate in the stock markets.
- USD/MXN with bearish bias, targeting 20.15.
USD/MXN is dipping modestly on Monday, trading around 20.25, in the same area as the last three trading days. The peso remains firm at its highest since October of last year, without being affected by the fall in the stock markets.
The climate of caution in equity markets is not weighing on several emerging market currencies, including the Mexican peso. Wall Street futures are in the negative, at their lowest in weeks. On Monday there will be no formal operations in the US as it is a US holiday, a fact that may reduce the volume of operations.
On Tuesday the activity will return to normal. In the US, the preliminary estimate of the Markit PMI for February will be published. In Mexico the key data will be on Thursday with the inflation of the middle of the month of February.
Technically USD/MXN remains bearish, and with the strong negative tone as long as it remains below 20.30/35. A return above that level would relieve downward pressure. The next resistance is seen around 20.50/52, a horizontal level and where the 20-day moving average is also passing. In the opposite direction, If it asserts below 20.25, the next target is at 20.15, which protects the 20.00/05 barrier.
Technical levels
Source: Fx Street
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