Forex Market: USD/MXN daily forecast

During yesterday’s trading session USD/MXN traded within the range of 12.9615-13.0022 and closed at 12.9840.

At 8:07 GMT today USD/MXN was gaining 0.01% for the day to trade at 12.9769. The pair touched a daily high at 12.9850 at 0:45 GMT.

Fundamental view

United States

Activity in United States’ manufacturing sector probably continued to expand during June, with the corresponding manufacturing PMI coming in at a reading of 55.5, according to expectations, from 55.4 in May. The Manufacturing Purchasing Managers’ Index (PMI) is a compound index, which represents manufacturing activity in 20 different industries. It is comprised by four equally-weighted components: seasonally adjusted employment, seasonally adjusted production inventories, seasonally adjusted new orders and supplier deliveries. The index is based on a survey of 300 purchasing managers.

Participants can either respond with “better”, “same”, or “worse” to the questions about the industry, in which they operate. The resulting PMI value is measured from 0 to 100. If the index shows a value of 100.0, this means that 100% of the respondents reported an improvement in conditions. If the index shows a value of 0, this means that 100% or the respondents reported a deterioration in conditions. If 100% of the respondents saw no change in conditions, the index will show a reading of 50.0. Therefore, readings above the key level of 50.0 are indicative of expanding activity in the sector of manufacturing, which usually supports the US dollar. The Institute for Supply Management (ISM) is to release the official reading at 14:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, in case USD/MXN manages to breach the first resistance level at 13.0037, it will probably continue up to test 13.0233. In case the second key resistance is broken, the pair will probably attempt to advance to 13.0443.

If USD/MXN manages to breach the first key support at 12.9629, it will probably continue to slide and test 12.9418. With this second key support broken, the movement to the downside will probably continue to 12.9222.