USD/MXN Technical Analysis
About the USD/MXN (US Dollar and Mexican peso)
USD/MXN pair is the abbreviated term used for US Dollar and Mexican peso. the US Dollar nickname is Buck and Mexican peso does not have a nickname. And this pair also do not have a nickname. Before we get into the particulars, what exactly does the USD/MXN rate mean? The exchange rate tells you how many Mexican pesos (the quote currency) are required to purchase one US Dollar (base currency). For example, if the pair is trading at 19.07, it means it takes 19.07 Mexican peso to buy 1 US Dollar
Breaking Down ‘USD/MXN
The United States dollar, or the American dollar, is the official currency, or money, of the United States of America and is also used in a number of different countries across the border. It is also the standard money for global markets selling goods such as gold and oil (fuel). While writing, the symbol for the American dollar is the dollar sign ($). Dollars can also be known as USD (U.S. Dollar).
The $Mexican Peso (sign: $; code: MXN) is the currency, or money, of Mexico. this $ symbol is used for peso which is the same with the US dollar this symbol is got from the Spanish-Mexican currency. this currency counted in the most traded currencies list The peso was officially issued by Spain so that why its name is Spanish dollar which continues inflow until the mid 19th century. The first coin were represented in 1863 with the named of centavos and worth one-hundredth of the peso. these coins continued inflow until the mid -20th century, but their content of gold was reduced substantially over time.
Correlation is merely a mutual relationship or connection between two or more things.
Positive correlation – The positive relationship merely is when pairs move in tandem with each other.
In the forex world, the EURMXN, GBPMXN, and EURPLN pairs are positively correlated
Negative correlation – In contrast, a negative relationship is when forex pairs move in the opposite direction, For example, XPTUSD, XTIUSD, and NOKJPY
Economic Events: The movement in the US Dollar economic and MEXICAN events determine the exchange rates. Top of the line economic events includes GDP, Employment Change, Industrial Production, and Consumer Price Index. Better than forecast data increases the demand for related currency and impacts the value of either the US Dollar and MEXICAN, causing fluctuations in the USD/MXN exchange rate.
Major Economic Events
Gross Domestic Product – the gross domestic product is the central measure of economic growth in the region.
Employment Change – The Sterling is also sensitive to changes in employment, as slacks in the labor market causes a drop in Inflation rates.
Consumer Price Index – Since one of the goals of the BOP is to maintain price stability, they keep an eye on inflation indicators such as the CPI. If the annual CPI deviates from the central
Industrial Production – This measures a change in the total inflation-adjusted value of output produced by manufacturers, mines, and utilities.
Political Events - Another critical factor is the political aspect. Instability, as seen in the Brexit referendum, can entirely change the direction of the currencies. So, stay up-to-date on the latest political and economic news.
What Determines the USD/MXN exchange Rate?
Several factors can impact the USD/MXN rate valuation, including:
FRS & BOM Monetary Policies: Federal Reserve System and Bank of Mexico Authority control the supply of money in the market, to keep the economy on track. A dovish policy, which is also known as expansionary policy, from either of the central banks, weakens the related currency. In contrast, a hawkish monetary policy (contractionary policy) strengthens the currency
The USD/MXN is traded in amounts denominated in the US Dollar.
Standard lot Size: 100,000
Mini lot size: 10,000
One pip in decimals 0.0001
Pip Value: $0.53