USDMXN trades lower for the third consecutive session as the first economic data reflecting the impact from the coronavirus outbreak in real economy released earlier.
The Initial Jobless Claims came in at 3283K, beating the expectations of 1000K on March 20. The Initial Jobless Claims 4-week average registered in at 998.25K above the previous week reading of 232.25K.
The U.S. Gross Domestic Product came in at 2.1% in line with expectations for the 4Q. The Core Personal Consumption Expenditures quarterly reading came in at 1.3% above the expectations of 1.2% in the fourth quarter. The United States Goods Trade Balance rose from previous $-65.5B to $-59.89B in February.
Fed chairman, Jerome Powell in an interview, said that the central bank is working hard to support the economy during the extreme financial conditions. Fed’s actions are a way to provide credit to small, medium (SME) and large businesses where the lending markets have frozen. Fed’s policies will mostly help facilitate the rebound in the economy.
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USDMXN Technical Outlook
USDMXN is 0.72% lower at 23.7468 as the rally that started on February 20 fades away after the pair made all-time highs on Monday. The technical picture is bullish for the pair despite the three days correction, and an attempt to previous higher can’t be ruled out.
On the downside, first support will be met at 23.6405 the daily low. Next support area stands at 23.4751 the low from March 20th. A break below 23.475 might open the way for a move lower to 22.8463 the low from March 18th.
On the flip side, initial resistance for USDMXN pair will be met at 24,2471 today’s high. The next resistance level on the upside stands at 24.9168, which guards the recent highs at 25.1636.
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