Last week, there were sharp swings in USDJPY, a decline in oil prices, and a surge in Tesla stock. What's next?
USD/MXN: optimistic on the vaccine coming?
Pfizer vaccine comes to Mexico this week to make this country one of the first in Latin America to start the treatment. 1.4 million doses are expected by the end of January – that’s while the Mexico City sees a spike of infections and sees restrictions for nonessential activity. Countrywide, 1.33 million cases are recorded with more than 118,000 mortalities.
Domestically, the US dollar is being pushed to the softer side on the Fed’s monetary direction and the delay of the stimulus. Coupled with the optimism of the vaccine for Mexico that supports the peso, it continues the long-term wavy downtrend of USD/MXN that has been there for the last six months. However, occasional spikes to the upside may put that trend to a test: the double bottom of 19.75 doesn’t seem to be a near-term target, and the crossing of 20.00 to the upside puts USD/MXN on the collision course with the trend’s upside. The high of 20.65 has been already touched a week ago so coming back up to it is definitely a possibility. Therefore, let’s watch this local rise and see if it bounces downwards or pushes through the trend’s upside.
Geopolitical factors and inflation remain the main drivers of financial markets. Let’s see how to use that in trading!
Last week was super intense! Geopolitical turbulence made the Russian ruble the most volatile currency. Gold rose and fell by more than 8000 points each time.
The US Markit will publish Flash Manufacturing and Flash Services PMIs (purchasing managers' indices) on June 23 at 16:45 GMT+3.
The Fed Chair Jerome Powell will testify on the Semi-Annual Monetary Policy Report before the House Financial Services Committee on June 22-23 at 17:00 GMT+3.
Canada will publish Retail Sales and Core Retail Sales on June 21 at 15:30 GMT+3.