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Tech Focus - Price Signal Summary: USDBRL Uptrend Resumes

  • USDMXN continues to trade inside its recent range, although overnight gains sees the pair towards the upper bound. The sideways activity since Jun 25 still appears corrective in nature and this is in line with a bearish risk that remains present. The next firm resistance is at 20.3504, 61.8% of the recent Jun 18 - 25 downleg. Note that a break of 20.2502, Jul 25 high would represent an initial bullish signal. On the downside, attention is on 19.7059, Jun 25 low and 19.5987, the Jun 9 low. A breach of both these levels would confirm a resumption of the downtrend.
  • USDBRL has broken above most recent highs and breached the key short-term resistance of 5.3130, Jul 8 high. The break of this hurdle has confirmed a resumption of the uptrend that started Jun 25. Additionally, closing above the May 24 high of 5.3740 is another bullish development. The most notable levels on the topside are the May highs of 5.4837, with stronger resistance in the form of the 61.8% retracement of the 2021 high/low swing that comes in at 5.5000. Initial support is now 5.3130.
  • The USDCLP needle continues to point north and the most recent strong bounce is seeing 795.73, the Aug 9 high and bull trigger being tested. Moving average studies remain in a bull mode too and a bullish price sequence of higher highs and higher lows dominates. A break of 795.73 would confirm a resumption of the uptrend and open 800.00 which provides both pivot and psychological resistance. Above here we note 806.84 which represents not only the August 2020 highs but also the 61.8% retracement from the March 2020 – May 2021 price swing. Key support lies at 768.33, Aug 12 low.

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