Open an Account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open an Account
✖

USDMXN Up Over 1 before Thursdays Bank of Mexico Meeting

November 12, 2019 10:27 AM

USD/MXN is one of the day’s biggest movers, up 1.20%,  as traders begin to focus on the Bank of Mexico meeting on Thursday.  Banxico is widely expected to cut interest rates by 25bps for the third time in a row, from 7.75% down to 7.50%.  Both growth and inflation have been falling in Mexico for the better part of the year.   The statement afterwards will be the more important part of the meeting, rather than the rate decision itself.  The markets will be interested to see just how dovish the Bank of Mexico will be.  USD/MXN seemingly brushed aside President Trump’s plea to democrats to pass the United State-Mexico-Canada Agreement (USMCA) during his speech at The Economic Club of New York.  It appears the markets are waiting for more action from the House, and less talk.

USD/MXN has been trading in a large symmetrical triangle since May 2018.  As price closed on the apex, the pair put in a false breakout to the topside in late August of this year near 20.2545.  As we have often seen, if price puts in a false breakout to one side of a pattern, it comes back to test the other side, which is precisely what happened to USD/MXN.  The pair stopped at support and bounced a bit, only to turn lower again and test the bottom of the triangle.  This pattern is an A-B = C-D, where the length of the move from A to B is equal to the length of the move from C to D.  After reaching the bottom of the triangle, price put in a false breakout to 19.0203 and bounced back into the apex of the triangle today. 

Source: Tradingview, FOREX.com

On a 240-minute timeframe, USD/MXN powered higher through the 19.3320 horizontal resistance level.  This level also coincided with the 50% retracement level from the recent highs on October 10th to the lows on October 28th.  Horizontal resistance above comes in near 19.5000, and then the October 10th highs near 19.6417.  Above that, a band of resistance is at prior highs and the 127.2% Fibonacci retracement level from the previously mentioned timeframe between 19.8500 and 19.8600.  First support arrives at the bottom trendline of the triangle on the daily timeframe near 19.1800.  Below there is a wide band of support at recent lows of 19.0222 and previous lows (not shown) down to 18.8500.

Source: Tradingview, FOREX.com

From a macro perspective, keep an eye on Thursday’s Bank of Mexico meeting, as well as, comments on the USMCA for the next direction for USD/MXN.  From a technical perspective, continue to watch for a clear break of the trendlines as price gets closer and closer to the apex of the symmetrical triangle. 


The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

FOREX.com is a registered FCM and RFED with the CFTC and member of the National Futures Association (NFA # 0339826). Forex trading involves significant risk of loss and is not suitable for all investors. Full Disclosures and Risk Warning. Increased leverage increases risk.

GAIN Capital Group LLC (dba FOREX.com) 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA. GAIN Capital Group LLC is a wholly-owned subsidiary of StoneX Group Inc.

© FOREX.COM 2025