Currently, USD/MXN is trading at 21.81, down -0.23% on the day, having posted a daily high at 21.96 and fresh low at 21.56.
Reuters reports, "The exchange rate today reflects a very pessimistic outlook on our ability to attract investment," said Mexico's finance minister Jose Antonio Meade on Thursday.
Immigration, Taxes and that Wall
Trump's agenda let market participants think and feel overexcited and building bets on a much-expected better US economy. However, the Mexican Peso indicates on the short-term, both sides of a new coin no one had seen before President-elect decided to come up with bold promises to make America-Free. Although most ideas are revolutionary on paper, there is a slight difference between innovative and continuity. If markets were in the presence of the 'next big thing' at the time of writing, the peso might as well be trading at 26.00; clearly, that's not the case.
Immigration is natural phenomena since humanity moved across continents through the Bering Strait; how is it possible to build a wall to stop it? On the other hand, the most efficient method known today, against all the odds, seems to dig into people's pockets via hard cold taxes. That's a class Mr. Trump either forgot or never attended to while in college.
USD/MXN Technical Levels
To the upside, on the short-term, only a close and open above the immediate resistance on the 21.80 handle, provides bulls with the necessary evidence to make another attack towards the big prize; 22.00 round figure. To the downside, support at 21.64 and later 21.57 near 100 SMA (red color) are the next logical zones to expect substantial buy interest.
On the medium-term view, there is plenty room to move lower, especially if Trump's agenda experiences a slow execution. In that case, the peso may continue lower towards 21.31 (short-term 61.8% Fib), then 21.08 (short-term 50.0% Fib) as the last stand provides a cost-effective entry without breaking the US dollar bullish trend.