USDMXN: Peso regains poise as S&P 500 futures rise


Share:
  • MXN picks up a bid as the US stock futures signal risk reset. 
  • Mexico's decision to reopen the economy is likely adding to upward pressure around the Peso.

The USD/MXN is feeling the pull of gravity for the third straight day with the Peso drawing bids amid signs of risk reset in the US stock futures. 

The currency pair is currently trading at 23.61, representing a 0.24% decline on the day. The bounce from Tuesday's low of 23.4467 ran out of steam at 23.75 during the early Asian trading hours. 

MXN's strength could be associated with the 0.5% rise in the S&P 500 futures. Essentially, futures are indicating that Wall Street could reverse or at least regain a part of the losses seen on Tuesday. Stocks fell on Tuesday, boosting demand for the safe-haven dollar after scientists raised questions over the positive test results of the US-based Moderna's coronavirus vaccine. 

Apart from the uptick in the stock futures, MXN seems to be benefitting from the optimism surrounding the reopening of its economy. Mexico issued guidelines on Monday for restarting operations in the automotive, mining and construction sectors, despite the rising death toll from the coronavirus pandemic. 

Looking forward, the Mexican peso could continue to track the optimistic turn in market sentiment. Also, action in oil prices could influence the MXN. At press time, the West Texas Intermediate crude's front-month contract is trading 0.16% lower on the day at $31.90 per barrel. 

The black gold has rallied by over 200% since bottoming out below $10 last month. Hence, a chart-driven pullback cannot be ruled out. That may weigh over MXN. 

Technical levels

    1. R3 24.1659
    2. R2 23.986
    3. R1 23.8105
  1. PP 23.6306
    1. S1 23.4551
    2. S2 23.2752
    3. S3 23.0997

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD extends recovery on Powell’s words

EUR/USD extends recovery on Powell’s words

EUR/USD has managed to stage a rebound toward  the 1.0740 price zone after having dropped to a fresh multi-week low below 1.0670. Stocks rally and the US Dollar eases as Fed Chairman Powell said that stronger-than-expected data will see the Fed raising rates accordingly.

EUR/USD News

GBP/USD rebounds to 1.2000 area as US Dollar loses strength

GBP/USD rebounds to 1.2000 area as US Dollar loses strength

GBP/USD has gained traction and climbed above 1.2000, erasing a large portion of its daily losses. As investors await FOMC Chairman Jerome Powell's speech, the US Dollar is struggling to preserve its strength, allowing the pair to edge higher.

GBP/USD News

Gold: Holding above $1,860, but upside still seen limited Premium

Gold: Holding above $1,860, but upside still seen limited

Spot gold saw little action throughout the first half of the day, consolidating its latest losses just above the $1,860.00 threshold. The US Dollar mainly advanced against its European rivals, as certain caution reigned ahead of a speech from US Federal Reserve (Fed) Chairman Jerome Powell, resulting in XAU/USD holding within familiar levels. 

Gold News

Google battles ChatGPT with Bard: Will this trigger rally in AI tokens?

Google battles ChatGPT with Bard: Will this trigger rally in AI tokens?

Google is getting its ChatGPT competitor ready for action, the company said that its AI service Bard would be open to trusted testers and the service is being prepared for release within the following weeks. 

Read more

Canoo Stock Forecast: Monday's GOEV plunge meets Tuesday buyers

Canoo Stock Forecast: Monday's GOEV plunge meets Tuesday buyers

Canoo (GOEV) stock is trading up more than 3% in Tuesday's premarket after a surprise share offering on Monday helped the EV small-cap to close 12.4% lower. This seemed like a major overreaction from the market, which should have seen this coming.

Read more

Forex MAJORS

Cryptocurrencies

Signatures