Forex Market: USD/MXN daily trading forecast

Friday’s trade saw USD/MXN within the range of 13.4982-13.3980. The pair closed at 13.4772, gaining 0.26% on a daily basis.

At 11:01 GMT today USD/MXN was down 0.05% for the day to trade at 13.4752. The pair held in a daily range of 13.4588-13.5018.

Fundamental view

United States

Markit Economics will likely report that factory output in the US expanded at a solid pace in October, but slower from a month earlier. The respective Manufacturing PMI is expected to confirm a preliminary reading of 56.2, trailing September’s final reading of 57.5.

Meanwhile, the Institute for Supply Management, whose manufacturing report is more widely tracked, is anticipated to report that manufacturing activity growth in the US remained robust, but it slowed down for the second consecutive month. The ISM Manufacturing PMI is poised to come in at 56.2 from 56.6 in September, registering the 17th straight month of expansion.

The report is also expected to show that the manufacturing employment sub-index inched up to 54.8 from 54.6 a month earlier, complementing recent upbeat labor data from the US.

Mexico

HSBC, in collaboration with Markit Economics, is expected to report at 15:30 GMT that manufacturing activity in Mexico edged up in October, which would be the 15th consecutive month of expansion. The respective HSBC Manufacturing PMI projected to come in at 52.8 compared to 52.6 a month earlier.

In Mexico, the HSBC Manufacturing Purchasing Managers’ Index measures the performance of the manufacturing sector and is derived from a survey of 400 manufacturing companies. Values above the key level of 50.0 indicate optimism among responding companies. In case the PMI rose more than expected, this would additionally support the peso, and vice versa.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 13.4578. In case USD/MXN manages to breach the first resistance level at 13.5176, it may continue up to test 13.5580. In case the second key resistance is broken, the pair could attempt to advance to 13.6178.

If USD/MXN manages to breach the first key support at 13.4174, it will probably continue to slide and test 13.3576. With this second key support broken, the movement to the downside will probably continue to 13.3172.

The mid-Pivot levels for today are as follows: M1 – 13.3374, M2 – 13.3875, M3 – 13.4376, M4 – 13.4877, M5 – 13.5378, M6 – 13.5879.

In weekly terms, the central pivot point is at 13.5018. The three key resistance levels are as follows: R1 – 13.6057, R2 – 13.7341, R3 – 13.8380. The three key support levels are: S1 – 13.3734, S2 – 13.2695, S3 – 13.1411.