LATAM FX: Price Signal Summary - USDMXN Remains In A Bear Cycle
- The USDMXN outlook remains bearish and the pair traded lower Monday as it extends the current bear leg. The pair last week cleared support at 19.7533, the Sep 12 low. The break confirmed the end of a period of consolidation that started mid-August. It has also confirmed a resumption of the downtrend that started Jul 14. The focus is on 19.4136, the May 30 low and 19.2802, 1.00 projection of the Jul 14 - Sep 12 - Sep 28 price swing. Key short-term resistance has been defined at 20.1759, the Oct 19 high. Initial resistance is at 19.8170, the 20-day EMA.
- USDBRL remains soft. The pair traded sharply lower on Oct 31 and the short-term outlook remains bearish. A key short-term support at 5.1121, the Oct 4 low, has been cleared and this strengthens the current bearish threat. Attention turns to support at 5.0108, the Aug 29 / 30 lows. Clearance of this level would open 4.8853, the 76.4% retracement of the May 30 - Jul 21 upleg. Initial resistance is at 5.2483, today’s intraday high.
- USDCLP remains below its recent high of 992.13 (Oct 21). The 50-day EMA has been breached. The break of this average signals potential for a deeper pullback and has exposed the 900.00 handle and 871.94, the Sep 9 low. Key resistance is at 996.97, the Sep 26 high. Clearance of this level would be bullish and open 1000.00 and 1061.00 further out, the Jul 14 high. Initial resistance is at 958.44, the Nov 3 high.
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JGB TECHS: (Z2) Weaker into the Close
- RES 3: 152.26 - High Dec 7 / 21 2021
- RES 2: 151.13 - High Mar 3
- RES 1: 150.81 - High Aug 5
- PRICE: 148.47 @ 14:44 BST Oct 7
- SUP 1: 147.62 - Low Sep 27
- SUP 2: 147.07 - Low Jun 20
- SUP 3: 145.05 - Low Jun 16 and a key support
JGB strength topped out at the week’s highs of 149.20, reversing into the weekly close and keeping the focus pointed lower. Any further weakness puts prices within range of support at 148.11, the Sep 7 low and a break would confirm a resumption of the bear cycle. Resistance for now remains intact at 150.81, the Aug 5 high.
USDCAD TECHS: Bounce Holds into Weekly Close
- RES 4: 1.4000 Psychological round number
- RES 3: 1.3970 3.236 proj of the Aug 25 - Sep 7 - 13 price swing
- RES 2: 1.3896 3.00 proj of the Aug 25 - Sep 7 - 13 price swing
- RES 1: 1.3838 High Sep 30 and the bull trigger
- PRICE: 1.3712 @ 14:20 BST Oct 7
- SUP 1: 1.3513 20-day EMA
- SUP 2: 1.3358 Low Sep 21
- SUP 3: 1.3224 50-day EMA
- SUP 4: 1.3139 Low Sep 14
Having traded lower Tuesday-into-Wednesday, USD/CAD bounced into the Thursday close, with gains holding into the weekly finish. Key resistance and the bull trigger, has been defined at 1.3838, the Sep 30 high. To the downside, attention is on the next firm support at 1.3513, the 20-day EMA. A break would strengthen bearish conditions.
AUDUSD TECHS: Bear Flag Formation
- RES 4: 0.6750 50-day EMA
- RES 3: 0.6671 High Sep 22
- RES 2: 0.6610 20-day EMA
- RES 1: 0.6550 High Sep 26
- PRICE: 0.6408 @ 14:19 BST Oct 7
- SUP 1: 0.6363 Low Sep 28 and the bear trigger
- SUP 2: 0.6337 Low Apr 24 2020
- SUP 3: 0.6283 Low Apr 23 2020
- SUP 4: 0.6255 1.236 proj of the Apr 5 - May 12 - Jun 3 price swing
AUDUSD continues to consolidate and this pause in the downtrend appears to be a bear flag, reinforcing bearish trend conditions. The recent break of support at 0.6682, Jul 14 low and a bear trigger strengthened a bearish case and this maintains the broader downward price sequence of lower lows and lower highs. The focus is on 0.6337 next, the Apr 24 2020 low. Initial firm resistance has been defined at 0.6610, the 20-day EMA.
