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Late Dip For USDMXN, Prints Fresh Trend Lows

MEXICO
  • After consolidating the post US CPI weakness below the 17.00 handle, USDMXN (-0.34%) has spent Friday slowly grinding lower and in the process has registered fresh trend lows of 16.7672 as of writing.
  • Price action earlier in the week confirmed a resumption of the primary downtrend and marks a continuation of the bearish price sequence of lower lows and lower highs. The target of 16.7758, the 1.764 projection of the Jun 2 - Mar 9 - Mar 20 price swing, has now been achieved. The 2.00 projection level lies at 16.4472 and will be the next significant support level. Resistance to watch is at the 50-day EMA, which intersects at 17.3692. A clear break of this average would be required to signal a reversal.
  • Retail sales is the only notable data point next week which should leave the Peso at the mercy of broader global themes as we approach the July 26 FOMC decision.

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