USD/MXN hits fresh weekly lows, still holds above 18.70
|- US dollar drops sharply against emerging market currencies.
- Mexican peso gains versus USD, but far from top performers.
The Mexican peso rose for the fourth day in a row against the US dollar. The currency recovered from last week loses and hit the highest level in 13 days. USD/MXN rose earlier today to 18.90 but then turned to the downside and during the US session bottomed at 18.72. Near the end of the session, was hovering around 18.76.
The move to the downside took place amid a slide of the US dollar against emerging market currencies on the back of positive market sentiment. The biggest gainers were the Argentine peso and the Turkish Lira, up more than 2% versus the greenback, followed by the South African rand. The MXN rose 0.35% and it was headed toward the highest close since October 1.
Levels to watch
The short-term picture favors the downside in the pair, but in order for the peso to gain momentum, it needs to make a clear break under 18.70. Below, the immediate target is located at 18.60 and then attention would turn to barrier at 18.45/50. To the upside, a recovery above 18.90 would remove the bearish tone and favor more consolidation ahead. If the greenback rises on top of 19.05, a test of 19.15/20 would seem possible.
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