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USDMXN Forecast – December-11-2023

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FxNews – The trading pattern of the USDMXN currency pair is currently displaying bullish tendencies. On Friday, the pair finished the trading session with a close above the pivotal mark of 17.36. Additionally, the Relative Strength Index (RSI) is presently positioned above the 50 level, further indicating a bullish momentum.

This upward trend in the USDMXN pair suggests a potential increase in its value. Analysts at FxNews anticipates a movement toward the median line of the bullish flag pattern. Should the bulls secure a position above the median line, the next goal for buyers would be the upper boundary of the flag. This scenario envisions a continued bullish trend, reflecting a positive outlook for the pair.

USDMXN Forecast - December-11-2023

USDMXN Analysis – 4H Chart

However, it’s important to consider the scenario where this bullish trend might not hold. If the bears manage to close below the 17.30 support and maintain stability, it would invalidate the current bullish scenario. In such a case, investors might need to reevaluate their strategies, considering the possibility of a downward or bearish trend.

Mexican Peso Drops as Inflation Slows

Bloomberg – The Mexican peso has recently weakened, falling over the 17.4 mark against the US dollar. This decline comes after a brief period of gains and is primarily attributed to signs of decreasing inflation. November’s core inflation in Mexico was recorded at 5.3%, lower than the anticipated 5.34% and a drop from the previous month’s 5.5%. This aligns with the recent statements from Banxico’s Governor Victoria Rodriguez Ceja and Deputy Governor Jonathan Heath. They indicated a potential easing of policies if the trend of reducing inflation continues, which has lessened the backing for the Mexican peso.

On the other hand, Mexico’s consumer confidence has seen a rise, reaching 47.3, which is higher than the 46.2 noted in October. This is the highest level of confidence observed since February 2019. This increase suggests a growing optimism and economic resilience within the country, possibly reducing the immediate need for the Bank of Mexico to ease its strict monetary policies.

  • 11 December 2023
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