Forex Market: USD/MXN daily trading outlook

Fridays trade saw USD/MXN within the range of 15.3316-15.1849. The pair closed at 15.2694, jumping 0.28% on a daily basis and settling the week 1.7% higher after a combined decline of 3.7% in the previous two weeks.

At 6:57 GMT today USD/MXN was down 0.17% for the day to trade at 15.2441. The cross held in a daily range of 15.2433 – 15.2873.

Fundamentals

A thin trading session will be observed today due to reduced liquidity as the US celebrates the Memorial Day holiday, while the UK celebrates the Spring Bank Holiday. No economic data are to be released from either country.

In Mexico, Insituto Nacional de Estadistica Y Geografia (INEGI) is expected to report at 13:00 GMT that the nations trade balance swung to a deficit of $0.509 billion in April.

In March, the country had a trade surplus at the amount of USD 0.480 billion, compared to a surplus figure of USD 0.949 billion a year earlier, as imports rose at a higher rate than exports. Total exports rose at an annualized rate of 2.7% to USD 34.14 billion in March, with oil sales dropping 44.3%, while non-oil exports grew 8.7%. Total imports increased 4.3% year-on-year to USD 33.66 billion as non-oil imports rose by 7.3%.

The trade balance reflects the difference in value between exported and imported goods during the respective period. A positive figure indicates that more goods and services have been exported than imported. Export demand has a direct link to demand for the national currency and also causes an impact on levels of production. In case Mexico had a wider trade balance deficit in March, this would have a certain bearish effect on the peso.

Pivot points

According to Binary Tribune’s daily analysis, the pair’s central pivot point stands at 15.2620. In case it penetrates the first resistance level at 15.3390, it will encounter next resistance at 15.4087. If breached, upside movement may attempt to advance to 15.4857.

If the cross drops below its S1 level at 15.1923, it will next see support at 15.1153. If the second key support zone is breached, downward movement may extend to 15.0456.

In weekly terms, the central pivot point is at 15.2015. The three key resistance levels are as follows: R1 – 15.3995, R2 – 15.5296, R3 – 15.7276. The three key support levels are: S1 – 15.0714, S2 – 14.8734, S3 – 14.7433.