USD/MXN hits 2-month highs above 19.00

USD/MXN managed to move off daily highs during the last hours amid a recovery in crude oil prices and a correction of the US dollar across the board. Earlier the pair jumped to 19.18, reaching the highest level since June 28 when financial markets were shocked by the Brexit referendum.

Currently, the pair is hovering around 19.03, off highs but 4.50% above the level it had a week ago. Last week the Mexican peso was among the worst performers in the currency market.

Donald Trump visited Mexico last week and afterward the Finance Minister, Luis Videgaray resigned. He was signaled as one of the strongest members of the cabinet. The new minister, Meade, is well known by President Peña Nieto and he already held the position during Calderon’s presidency.

Technical outlook

Today the pair is breaking a relevant resistance area, that is the 19.00 handle. A consolidation on top would add momentum to the US dollar. The pair traded above 19.00 on two times during the current year, but it failed to post a weekly close on top. In the short-term, if its pullback back below 19.00, the peso could gain momentum.

Analysts from Brown Brothers Harriman said: “USD/MXN has retraced nearly three quarters of the post-Brexit drop.  The pair is on target to test the all-time high near 19.52 from June 24.  The 200-day MA comes in near 18.12.”