MEXICO: USDMXN Steady Following Tariff Developments, Trade Balance Data Due
Feb-27 11:10
- USDMXN remains in a familiar holding pattern, continuing to respect the short-term technical parameters of 20.20-20.70, despite ongoing bouts of intra-day volatility on tariff developments. On Wednesday, we saw a near 1% move lower for USDMXN on the back of the Trump headlines announcing that the new tariff deadline for both Mexico and Canada had been extended to April 02, compared to the prior date of March 04.
- The initial optimism was immediately tempered, as markets digested the latest developments. Although the extension could be seen as providing more time to negotiate broader trade deals, Trump mentioning that the US is “not stopping the tariffs” will have likely offset the initial price spike for the peso.
- A reminder that dialogue between US & Mexican officials is continuing, and Mexico’s Economy Minister Marcelo Ebrard visits Washington to hold meetings on trade later today. Recall that on Tuesday, President Sheinbaum said her administration aims to close a tariff deal with the US by next Tuesday.
- On today’s economic calendar, January unemployment rate figures and trade balance data are scheduled at 1200GMT/0700ET:
- Jan. Revised Trade Balance, est. -3.81b, prior 2.57b
- Jan. Imports, prior 49.1b
- Jan. Exports, prior 51.7b
- Jan. Unemployment Rate NSA, est. 2.70%, prior 2.43%
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US 10YR FUTURE TECHS: (H5) Monitoring Resistance At The 50-Day EMA
Jan-28 11:10
- RES 4: 110-25 High Dec 12
- RES 3: 110-19 76.4% retracement of the Dec 6 - Jan 13 bear leg.
- RES 2: 109-31 High Dec 18
- RES 1: 109-12+ 50-day EMA
- PRICE: 108-29+ @ 10:35 GMT Jan 28
- SUP 1: 108-00/107-06 Low Jan 16 / 13 and the bear trigger
- SUP 2: 107-04 Low Apr 25 ‘24 and a key support
- SUP 3: 107-00 Round number support
- SUP 4: 106-11 2.00 proj of the Oct 1 - 14 - 16 price swing
The medium-term trend condition in Treasury futures is down, however a bullish short-term cycle highlights a corrective phase and the contract is holding on to its recent gains. Attention is on 109-12+, the 50-day EMA - a level tested on Monday. A clear break of this EMA would strengthen a bullish theme and open 109-31, the Dec 18 high. The bear trigger is 107-06, the Jan 13 low. Initial support has been defined at 108-00, the Jan 16 low.
US: SOFR FIX - 28/01/25
Jan-28 11:04
SOFR FIX - Source BBG/CME
- 1M 4.31032 -0.00268
- 3M 4.28689 -0.00698
- 6M 4.22963 -0.0166
- 12M 4.13904 -0.04071
EQUITIES: Estoxx Put Fly
Jan-28 11:02
SX5E (21st Mar) 5000/4900/4800p fly, bought for 5 in 5k.
