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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
MXN
- Earlier in the week we noted the break below significant support for EURMXN at 20.0550, a level which corresponded with the pandemic lows and a low back in mid-2017.
- Some analysts had indicated that short EUR/MXN allows for exposure to high LatAm yields, but with a tighter connection to a still-strong US growth outlook, and somewhat less vulnerability to further wobbles in China or the commodity complex.
- Helped by EURUSD breaking below 0.9950, the break for EURMXN saw a decent amount of follow through to lows of 19.7747 on Wednesday. Since then, despite brief periods of Euro strength, the ‘super’ Peso has retained its resilient tag and EURMXN had broadly remained below the 20.00 mark.
- The pair received its sternest test today as earlier headlines suggested some European Central Bank policymakers want to discuss a 75 basis point interest rate hike at the September policy. However, the resulting strength for the single currency prompted a perfect test of 20.0550, now acting as short-term resistance and we have seen a subsequent selloff back to levels around 19.90 as of writing.
- Obvious fundamental headwinds linger for the single currency in the form of the ongoing energy crisis that may keep the focus on further downside for EURMXN. Furthermore, the biggest domestic obstacle of uncertainties relating to USMCA disputes appears to be under control, according to the latest rhetoric from President AMLO and Foreign Minister Ebrard.
- The focus technically is also on a continuation lower and the next support levels to watch are:
- 19.6250, low Apr 14 2017
- 19.4545 2.236 projection of Nov ‘21 - Oct ‘21 - Feb ‘22 swing
- 19.1719 2.382 projection of Nov ‘21 - Oct ‘21 - Feb ‘22 swing
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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