After Mexico and the USA reached a deal to curb migration and avoid tariffs on Mexican imports, the Mexican peso strengthened around 2 percent against the dollar during the Asian trading. I expect the USDMXN
to go lower during the American trade session as well. In the long run, I still believe USDMXN
will go lower than 18.90 if there are no more conflicts between the USA and Mexico. However, Trump could threat Mexico again with tariffs as a weapon to get fast results from Mexico, especially during this time (elections in 2020), making the Mexican peso weak.
The immediate support is the 18.9 area (blue line). If we break that support, we could go to the second strong support at 18.75 and then lower.
It is important to notice that the USDMXN
price is in a triangle since last year. If there is good news from Mexico, we could finally break the triangle to the downside.
Thanks for reading!