USD/MXN sees uptick amid China’s economic concerns, ahead Powell’s Jackson Hole speech

Wall Street shows positive signs, but China’s rate cut and push for increased lending dampen global sentiment.
US Dollar remains steady with the DXY at 103.472 as market participants look forward to a packed US economic calendar.
Mexico’s upcoming inflation and Q2 GDP data could influence the USD/MXN trajectory, with potential appreciation if Mexico’s economy falters.

Christian Borjon Valencia FXStreet

USDMXN registers minimal gains even though a risk-on impulse would usually underpin the emerging market currency. Monday’s light economic calendar would leave traders adrift to sentiment weighed by China’s woes and US Dollar (USD) dynamics. The USD/MXN exchanges hands at 17.0620, gaining 0.01%.

Emerging market currency feels the heat from China’s rate cut and US Dollar dynamics, while traders await key economic data and Powell’s speech

Wall Street trades positively, portraying investors’ mood improved ahead of the Jackson Hole Symposium, organized by the Kansas City Fed in Wyoming. US Treasury bond yields advance, slightly underpinning the greenback, which remains flat at 103.472, as shown by its US Dollar Index (DXY).

China’s woes weighed on investors’ sentiment after the People’s Bank of China (PboC) cut rates on its 1-year Loan Prime Rate from 3.55% to 3.45%, disappointing analysts. As reported by Bloomberg, it’s said that PboC’s officials and government regulators told lenders to boost loans to support recovery.

In the meantime, a National Association of Business Economics (NABE) poll showed economists are more confident that the Fed would pull a soft landing, as revealed by Bloomberg.

The upcoming United States (US) calendar will reveal Existing Home Sales, Fed speakers, New Home Sales, S&P Global PMIs, Jobless Claims, Durable Good Orders, and Fed Chair Jerome Powell’s speech on Friday.

Across the border, the Mexican economic docket would witness the release of inflation figures for the first half of August and the second quarter Gross Domestic Product (GDP) report on Friday.

Given the backdrop, if the Mexican economy weakens, expect the USD/MXN to appreciate further. Likewise, dovish signals by Fed officials and Jerome Powell’s speech would be repriced by traders, weakening the USD/MXN pair.

USD/MXN Price Analysis: Technical outlook

The USD/MXN remains subdued, unable to crack below/above support and resistance levels, each at 17.0000/17.1878. On the downside, the confluence of the 50 and 20-day Moving Averages (DMAs) at 17.0060/17.0160 emerged as a solid support level, which, if cleared, the USD/MXN could dip towards the year-to-date (YTD) low of 16.6238. Conversely, if USD/MXN breaks above 17.1878, the pair could rally towards the 100-DMA at 17.4135.

USD/MXN Daily Chart

USD/MXN

Overview
Today last price	17.0412
Today Daily Change	-0.0158
Today Daily Change %	-0.09
Today daily open	17.057

Trends
Daily SMA20	17.0056
Daily SMA50	17.0284
Daily SMA100	17.4305
Daily SMA200	18.1906

Levels
Previous Daily High	17.1366
Previous Daily Low	17.0167
Previous Weekly High	17.2094
Previous Weekly Low	16.9663
Previous Monthly High	17.3957
Previous Monthly Low	16.6258
Daily Fibonacci 38.2%	17.0625
Daily Fibonacci 61.8%	17.0908
Daily Pivot Point S1	17.0036
Daily Pivot Point S2	16.9502
Daily Pivot Point S3	16.8837
Daily Pivot Point R1	17.1235
Daily Pivot Point R2	17.19
Daily Pivot Point R3	17.2434

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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