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Price Signal Summary: USDBRL Path Of Least Resistance Remains Down

LATAM FX
  • No change in the USDMXN trend condition. The pair did find some support yesterday but continues to trade closer to its recent lows and the downtrend remains intact. Last week’s continuation lower, together with the recent break of 20.00, reinforced a bearish condition. Moving average studies remain in a bear mode, highlighting current sentiment. The focus is on 19.7059, the Jun 25, 2021 low. Resistance to watch is at 20.2052, the 20-day EMA.
  • USDBRL remains bearish. The break lower last Friday marked a resumption of the downtrend and confirmed a bear flag formation on the daily chart. 4.6000 has been breached and this opens 4.5439 next, 1.236 projection of the Mar - Jun - Dec 2021 price swing. The 20-day EMA at 4.8464 remains the key short-term resistance.
  • USDCLP remains above the Mar 29 low of 771.89. The trend is bearish though and short-term gains are considered corrective. The pair traded lower last week and cleared support at 783.51, the Feb 23 low and the bear trigger. This confirms a resumption of the primary downtrend. Initial resistance is seen at 800.90, the 50-day EMA. A resumption of weakness would open 761.31, 61.8% of the rally between May - Dec 2021.
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