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MEXICO: Renewed MXNJPY Weakness Shifts Focus Back to 6.99 Support

MEXICO
EM BulletMexicoBulletEmerging Market NewsNorth America
  • Domestic uncertainty in Mexico and general risk off surrounding the stagflationary concerns in the US have amplified the weakness for MXNJPY on Tuesday. The cross, often considered as a strong barometer for risk, sits 1.8% lower on the session, with technical conditions bolstering the bearish theme.
  • Recent depreciation has prompted a test of a cluster of daily lows at 7.2865, and price action across the last two sessions has seen a clear breach of this support. The subsequent selloff will renew the market’s focus on the 2024 lows, located at 6.99.
  • Below here, medium-term targets for the move are located at 6.7911, the March 2023 low, and 6.5885, the Dec 2022 low.
  • Immediate focus will turn to Sunday’s public event in Mexico, where President Sheinbaum said she will announce details on counter measures. The timing of the event perhaps indicates that Mexico hopes to de-escalate the trade war, with a potential Trump phone call on Thursday eagerly awaited.
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  • Domestic uncertainty in Mexico and general risk off surrounding the stagflationary concerns in the US have amplified the weakness for MXNJPY on Tuesday. The cross, often considered as a strong barometer for risk, sits 1.8% lower on the session, with technical conditions bolstering the bearish theme.
  • Recent depreciation has prompted a test of a cluster of daily lows at 7.2865, and price action across the last two sessions has seen a clear breach of this support. The subsequent selloff will renew the market’s focus on the 2024 lows, located at 6.99.
  • Below here, medium-term targets for the move are located at 6.7911, the March 2023 low, and 6.5885, the Dec 2022 low.
  • Immediate focus will turn to Sunday’s public event in Mexico, where President Sheinbaum said she will announce details on counter measures. The timing of the event perhaps indicates that Mexico hopes to de-escalate the trade war, with a potential Trump phone call on Thursday eagerly awaited.
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