Many countries remain closed for the Christmas holidays and trading volumes are extremely thin. The US will publish one regional economic report, following yesterday’s disappointing durable goods orders. The USDMXN moved to the lower band of its horizontal support area, what impact will today’s sole US economic report have on price action? Today’s fundamental analysis will take a look at the upside potential as well as the downside risk in this currency pair.
The Mexican Economic Activity IGAE will give forex traders the final economic report before Christmas Eve dinner. Economic concerns in Mexico increased, and inflationary pressures eased slightly in December. Despite the concerns, the Mexican Peso was able to strengthen against the US Dollar, a trend which started in December 2018. How much longer can this trend continue? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Here is the key factor to keep in mind today for US Dollar trades:
- US Richmond Fed Manufacturing Index: The US Richmond Fed Manufacturing Index for December is predicted at 1. Forex traders can compare this to the US Richmond Fed Manufacturing Index for November, which was reported at -1.
Here is the key factor to keep in mind today for Mexican Peso trades:
- Mexican Economic Activity IGAE: The Mexican Economic Activity IGAE for October is predicted to increase by 0.22% annualized. Forex traders can compare this to the Mexican Economic Activity IGAE for September, which decreased by 0.10% annualized.
Should price action for the USDMXN remain inside the or breakdown below the 18.8850 to 19.0350 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 18.9400
- Take Profit Zone: 17.9400 – 18.0620
- Stop Loss Level: 19.0900
Should price action for the USDMXN breakout above 19.0350 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 19.0900
- Take Profit Zone: 19.3180 – 19.4625
- Stop Loss Level: 18.9400
Open your PaxForex Trading Account now and add this currency pair to your forex portfolio. Forex trading for beginners often poses a tremendous challenge, take a look at how PaxForex ensures that you are on the right track from your first trade!
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