The Mexican Peso recovers marginally as the market turns risk-on, benefiting emerging market FX. A possible revival of carry trade inflows amid a weaker Japanese Yen and reduced domestic political risk are further factors supporting the Peso. USD/MXN is in the midst of unfolding a bullish ‘abc’ pattern move. The Mexican Peso edges higher on Tuesday, rising by about a quarter of a percent across its most-heavily traded pairs.
The up leg is probably the “c wave” of a bullish “abc” pattern, which began at the October 14 swing low. It will probably reach the Fibonacci 61.8% of the length of wave “a”, giving an upside target of 20.29. Such a move would gain confirmation from a break above the high of wave “b” at 20.09. USD/MXN Daily Chart USD/MXN is probably in an uptrend on a short, medium and long-term basis and is trading in a rising channel.