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Forex Market: USD/MXN daily forecast

During Friday’s trading session USD/MXN traded within the range of 12.9822-13.0396 and closed at 12.9901.

At 7:23 GMT today USD/MXN was losing 0.04% for the day to trade at 12.9855. The pair touched a daily low at 12.9743 at 6:45 GMT.

Fundamental view

United States

At 14:00 GMT the National Association of Realtors (NAR) will report on existing home sales in the United States during May. The existing home sales probably jumped 2.2% to an annualized pace of 4.74 million units in May from a month ago. In April compared to March, existing home sales rose 1.3% to an annualized level of 4.65 million. The sample of data encompasses condos, co-ops and single-family houses.

Statistical data on existing home sales is often used along with statistical figures regarding the New home sales and Pending home sales, with the major objective being to draw a conclusion how nation’s housing sector is performing, regardless of interest rates. The most active house-purchasing period in the United States is usually between the months of March through June. Therefore, in case statistical data revealed a sudden drop in the number of homes sold rather than an improvement during this period, this would be considered as a signal of weakness in country’s housing market.

The report on existing home sales usually does not cause a real direct impact on US economy. Actually, this effect appears to be minimal, due to the fact that nothing is produced with the mere sale of an existing home. In terms of economic activity, the sale of an existing house may be related only to interior design and purchases of new furniture.

In case the index increased more than anticipated, this would support the greenback.

Mexico

The Mexican unemployment rate probably fell to 4.8 in May, from 4.86% in the previous month, according to the median analysts forecast.

According to the classification of the nations statistical office, Instituto Nacional de Estadística y Geografía (INEGI), a person is considered employed if he/she is older than 14 years and have been working at least six hours a week, regardless of the occupation. The country has a population of about 113 million people, of whom almost 50% (over 52 million people) live in poverty, according to the latest (2012) census.

Instituto Nacional de Estadística y Geografía is scheduled to release an official report at 13:00 GMT. In case the unemployment rate falls more than expected, this would boost pesos demand.

Technical view

Screenshot from 2014-06-23 10:26:34

According to Binary Tribune’s daily analysis, in case USD/MXN manages to breach the first resistance level at 13.0259, it will probably continue up to test 13.0614. In case the second key resistance is broken, the pair will probably attempt to advance to 13.0831.

If USD/MXN manages to breach the first key support at 12.9681, it will probably continue to slide and test 12.9466. With this second key support broken, the movement to the downside will probably continue to 12.9109.

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