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Price Signal Summary - USDMXN Pullback Considered Corrective

  • USDMXN traded lower Tuesday. Despite the pullback, the trend outlook is bullish following the recent reversal from 19.0401, Nov 29 low. Two important Japanese candlestick patterns highlighted this recent reversal; a hammer formation on Nov 29 and a bullish engulfing candle on Dec 2. The subsequent rally reinforced the bullish case. The 50-day EMA has been cleared and this opens 19.9920, 61.8% of the Sep 28 - Nov 29 bear leg. Key support lies at 19.0401. Initial support is at 19.3489, the Dec 5 low.
  • USDBRL is firmer but remains below the Nov highs. The pair, in November, breached resistance at 5.4286, the Sep 29 high and pierced 5.5142, the Jul 21 high and a medium-term bull trigger. A clear break of the latter is still required to cancel a bearish theme and instead signal scope for a stronger move higher near-term. Initial firm support at 5.2445, the Nov 10 low, was breached on Nov 30. The move lower exposes 5.0108, the Sep 29 / 30 low. Short-term gains are considered corrective - for now.
  • USDCLP is trading at its recent lows and sights are on support at $849.75, the Sep 5 low. This level has been pierced, a clear break would signal scope for weakness towards $807.85, the Jun 3 low. On the upside, key short-term resistance has been defined at $956.45, the Nov 21 high. Initial resistance is at $911.04, the 50-day EMA.

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