USD/MXN turns positive after hitting eight-month lows
- Mexican peso fails to hold to gains versus US dollar on Thursday, back to the recent range.
- USD/MXN keeps bearish bias, but unable to break 2019 lows.
The USD/MXN pair dropped earlier today to 18.75, just a few pips above the 2019 low, but then rebounded and turned positive. It printed a daily high at 18.87 and near the end of the session is trading around 18.84, marginally higher for the day.
As the positive market mood eased, USD/MXN moved off lows, also boosted by a rally of the US dollar across the board supported by higher US yields. Market participants keep focussing on the Middle East tensions. Regarding data, the key report ahead is the Non-farm payroll report on Friday.
“With central banks from Washington to Ottawa, London to Canberra on hold, economic statistics will be the determining factor for currencies. In that competition American labor production should soon return the gloss to the US dollar,” mentioned Joseph Trevisani, Senior Analyst at FXStreet.
Levels to watch
The USD/MXN was rejected again from below 18.80. If it manages to hold below it would likely open the doors to more losses targeting 18.65. The bias will continue to be biased to the downside as long as it holds below 18.98/19.00 (horizontal resistance and the 20-day moving average).