USD/MXN consolidates near 21.00, up 11% from a week ago

The Mexican peso remains unchanged against the US dollar on Monday,  holding near all-time lows. Today USD/MXN moved sideways, consolidating last week record gains. 

USD/MXN waiting for Banxico, Fed and Trump 

On Thursday, the Bank of Mexico will decide on monetary policy. Market consensus points to a 50 bp rate hike, but some speculate about a higher increase. After collapsing on Wednesday following the victory of Donald Trump, some kind of action from Banxico was expected in order to avoid a sharp depreciation of the peso and also to keep inflation expectations anchored. 

Today USD/MXN peaked at 21.08 on European hours and then pulled back to 20.67. It was trading at 20.80/85, around Friday’s closing price and still near the record highs it reached at 21.38. 

Technical levels 

To the upside, resistance level might be seen at 21.05/10 (daily high), 21.38/40 (Nov 11 high) and 21.50 (psychological). On the opposite direction, relevant support areas could be located at 20.50 (Nov 11 low), 19.70 (Nov 10 low) and 19.55 (Nov 3 high).