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TECHS: LatAm FX Price Signal Summary: USDMXN Remains Vulnerable

EMERGING MARKETS


  • USDMXN is trading closer to recent lows and maintains a softer tone.
    • A bearish theme follows the recent clear break on Mar 31 of trendline support drawn off the Jan 21 low. Bears have since not looked back.
    • Furthermore, price has traded through the Mar 18 low of 20.2829 - a former key support. The break has strengthened a bearish argument and yesterday, support at 19.8924, Feb 15 low, was breached. This opens 19.5494, Jan 21 low.
    • On the upside, resistance is at 20.2427, Apr 13 high.
  • USDBRL traded lower again yesterday. Importantly, the pair has breached support at 5.5396, Apr 8 low. An extension of the current bear cycle would confirm two key developments:
    • The break of trendline support drawn off the Dec 14 low.
    • A bearish triangle breakout. Price action since Mar 9 appears to have been trading within a triangle. This pattern was considered a bullish signal however the continued move lower suggests the breakout will likely favour bears. The break lower has opened 5.6771, Apr 16 high.
    • Key near-term support is unchanged at 5.5396, Apr 8 low.
  • USDCLP remains weak and is still in a downtrend. The pair Friday probed a key support at 699.19, Feb 24 low. This signals scope for weakness towards the primary support at 693.00, Jan 6 low. A break of this level would confirm a resumption of the broader downtrend that started March 2020. Initial resistance is at 714.50, Apr 13 high.
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