EUR/USD and Mexico: Levels, Ranges, Targets

Mexican President Pena Nieto hails from the dominant Institutional Revolutionary Party, dominant means for the past 132 years and ruling for the past 57. The IRP in context is a pro business party and shares the same free market perspectives as Trump and the United States Republican party. Before Mexico manufactured autos for US imports, majority exports were oil, Silver, cement and arts and crafts. A time once existed when MXN was driven by Oil, Silver and cement. The question should Trump deal with Mexico on the wall issue so the IRP remains in power, doesn’t fall to the leftist parties and because Mexico is not only the gateway to Central American nations but a fall in the IRP may mean chaos if the left parties assume power.
Other issue to the Wall and highlighted this week by UBS in a research report is Mexican workers in the United States provides Mexico 2 to 3% of GDP by Remittances and its Mexico’s asset to accumulate foreign exchange reserves. Mexicans employed in the United States transfer weekly money home and after 2 and 3 years work, head home to a house, farm, auto and children’s college money. Not only are assets paid but plenty of cash exists to live comfortably for many many years. The IRP once provided border crossing road maps.
EUR/USD. Range currently 1.0824 to 1.0606. Most vital lines to cross above are 1.0693, 1.0723 and 1.0741. Then 1.0753, 1.0765 and 1.0775. Bottoms today are located at 1.0616 and 1.0614. Top of the channel is located at 1.0765 and 1.0799.
Further most bottoms 1.0599, 1.0573, and 1.0516.

 

Brian Twomey, Inside the Currency Market, btwomey.com

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