During the daily press briefing of Andres Manuel Lopez Obrador, it was announced that Mexico will receive 1.4 million doses of the vaccine by the end of January. Is that optimistic enough for the peso?
Currency market on December 5
Thursday's start has been quite eventful. The great pound's surge has been highlighting the day, while oil traders are cautiously awaiting the OPEC meeting. Read more about the main market movers below.
Disappointing economic data pulled the AUD down
While the level of retail sales showed a slowdown versus the expected advance by 0.3%, the Australian exports declined from 6.49 to 4.5 billion AUD. On H4, the Australian dollar has kicked off the resistance at 0.6848 and fell below the 200-period MA to the 0.6831 level. The price is trying to form the “Double top” pattern with the neckline at 0.6821. As soon as this level is broken, bears will be ready to move the aussie towards the lower target at 0.6810. The upside momentum is limited by the 0.6848 and 0.6855 levels.
The British pound has continued its bullish momentum
Today we’ve already explained what is going on with the British pound. You can read more about it here. On H4, GBP/USD continues to move up to May’s peak at 1.3170. If bulls manage to successfully break this level, the next resistance will be placed at 1.3220. In case of the reversal, watch at the supports at 1.3082 and 1.3050.
USD/MXN: More downside is possible
USD/MXN took advantage of the weak USD. On the 4-hour chart, the pair slid below the 50-period MA yesterday. Today, it has already tested the 100-period MA, which serves as strong support at 19.4270. In case of a breakout, we may expect further fall towards the 19.36 level. However, a stochastic oscillator formed a crossover in the oversold zone and RSI is looking up. That is why we may expect a short-term correction to 19.48 and 19.53.
Poor US data, slow vaccine distribution, rising virus cases worsened the market sentiment and underpinned safe-haven currencies like the USD, and JPY.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.