Forex Critical: A Sweet Spot for the Mexican Peso

Just as I had hoped and anticipated, the Banco de Mexico hiked its interest rate to 7.0% on June 22nd and kept pace with the U.S. Federal Reserve’s rate hike. Apparently, this rate hike was not a news flash. According to Reuters, the consensus opinion also anticipated a rate hike: “Analysts expected Mexico would match … Read more

Forex Critical: U.S. Dollar Carry Trades On the Edges of Major Moves

My bearishness on the U.S. dollar index (DXY0) continues as two currency positions in particular have delivered against the U.S. dollar. A month ago I wrote about the Turkish Lira (USD/TRY) and suggested that the high-yielding currency pair would eventually crack below support at its 200-day moving average (DMA). USD/TRY delivered at the end of … Read more

Forex Critical: A Major Breakthrough Eluded Mexican Peso Bulls

Bulls in the Mexican peso successfully reversed all the post-election gains in USD/MXN. Yet they failed to hold onto a big break through when USD/MXN hit a new 6-month low last week. Buyers quickly stepped in and sent USD/MXN right back to its declining 50-day moving average (DMA). Source: The latest CFTC data on … Read more

Forex Critical: Bullishness On the Mexican Peso Soars to A Near 3-Year High

The Trump-wind blowing against the Mexican peso is officially over. In late April, I noted how net non-commercial positions (speculators) in the Mexican peso flipped bullish for the first time in two years just as the peso completely reversed its losses from the election of Donald Trump as U.S. President. I showed how prior changes … Read more

Speculators In the Mexican Peso Last Did This At Oil’s 2014 Peak

On April 17, 2017, speculators turned bullish on the Mexican peso for the first time in 2 years. That point 2 years ago was a brief 1-week relief from on-going bearishness against the peso. The latest data on net non-commercial positions (speculators) show that the nascent bullishness in the peso carried over into a second … Read more

Above the 40 (April 26, 2017) – A Stretched Stock Market Loses Bid for Overbought Status

AT40 = 68.1% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 65.4% of stocks are trading above their respective 200DMAs VIX = 10.9 (volatility index) Short-term Trading Call: bullish Commentary AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages (DMAs), pushed into overbought territory today with … Read more

Above the 40 (April 7, 2017) – An Incrementally More Dangerous Stock Market

AT40 = 46.9% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 62.0% of stocks are trading above their respective 200DMAs VIX = 12.9 (volatility index) Short-term Trading Call: cautiously bullish (notable caveats explained below) Commentary The timetable for a May end to this period of extremely low volatility looks like … Read more