• Wall Street is falling sharply, volatility soars as US yields hit multi-year highs.
  • Emerging market currencies are under pressure on risk aversion.
  • USD/MXN erases losses and looks at 20.50.

The USD/MXN is rising sharply on Thursday, erasing Wednesday’s losses and, so far, recovering 20.30. During the last two hours, the pair rose more than 1.20% amid a rally of the US dollar across the board.

US stocks give back Fed gains and more

The greenback gained momentum amid a selloff in Treasuries. The US 10-year yield stands at 3.09% and the 30-year at 3.18%, both at the highest level since Q4 2018. Higher yields and risk aversion are boosting the dollar. The DXY is about to test the 2022 high as it trades at 103.82.

Fears about higher rates hit market sentiment. On Wednesday, stocks had the best day since 2020 in Wall Street. On Thursday, they are given back all those gains and even more. The Dow Jones tumbles 3.30%, and the Nasdaq plummets 5.02%.

The negative environment weakened emerging market currencies. The worst performer is the South African rand (USD/ZAR up 3.90%) and the Brazilian real (USD/BRL +2.58%).

Key levels

The USD/MXN is back at the 20.30 level after hitting earlier the lowest level in two weeks under 20.00. The reversal put upside risks back on the table. If it holds above 20.30, the dollar could rise to test the critical short-term resistance area of 20.50. Above, the next resistance stands at 20.70.

If USD/MXN fails to hold above 20.30 and slips back under 20.20, the Mexican peso could regain control, looking for a new test of 20.00.

Technical levels



Today last price 20.263
Today Daily Change 0.2359
Today Daily Change % 1.18
Today daily open 20.0271
Daily SMA20 20.1288
Daily SMA50 20.3252
Daily SMA100 20.4274
Daily SMA200 20.4329
Previous Daily High 20.3089
Previous Daily Low 20.0005
Previous Weekly High 20.6382
Previous Weekly Low 20.1614
Previous Monthly High 20.6382
Previous Monthly Low 19.7269
Daily Fibonacci 38.2% 20.1183
Daily Fibonacci 61.8% 20.1911
Daily Pivot Point S1 19.9154
Daily Pivot Point S2 19.8038
Daily Pivot Point S3 19.607
Daily Pivot Point R1 20.2238
Daily Pivot Point R2 20.4206
Daily Pivot Point R3 20.5322



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