USDMXN Analysis & #BTCUSD Forex Signal (10 June 2024)

BTC/USD Forex Signal: More Bearish Consolidation

BTCUSD produced a nicely profitable long trade entry from the bullish bounce when the support level at $68,243 was first reached.

Today’s BTC/USD Signals

• Risk 0.75% per trade.
• Trades must be taken before 5pm Tokyo time Tuesday.

Long Trade Ideas

• Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $68,598, $68,243, or $67,088.
• Place the stop loss $100 below the local swing low.
• Adjust the stop loss to break even once the trade is $100 in profit by price.
• Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.

Short Trade Ideas

• Short entry after a bearish price action reversal on the H1 timeframe following the next touch of $69,827, $70,093, or $71,659.
• Place the stop loss $100 above the local swing high.
• Adjust the stop loss to break even once the trade is $100 in profit by price.
• Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

BTC/USD Analysis

I wrote in my previous BTC/USD analysis one week ago that the price was stuck within a wedge pattern, so I thought things would get more bullish above $70,625 or more bearish below $66,700. This was an OK call as the price held within that range over the day, making a bullish breakout the next day which could have been profitably exploited using this same signal.

The technical picture has become more bearish now, as the price action has invalidated the wedge, producing more of a simple rectangular consolidation pattern between $67,000 and approximately $72,000 which is basically the zone I was talking about last week.

I again see the price as likely to hold within this zone, and I will take a bullish bias if we later get a bullish breakout above $71,549 or a bearish bias if we get a bearish breakdown below $67,000.

Another alternative today would be to take a new long trade if we get a bullish bounce at $67,000.

Despite the arguably bullish long-term trend, I feel that short trades will probably have more potential.

There is nothing of high importance due today regarding either Bitcoin or the US Dollar.

USD/MXN Analysis: Threat of Political Storm Creating Nervous Reaction

The USD/MXN has seen political threats cause a burst of nervousness in the USD/MXN which have caused a strong bullish surge to emerge.

• The USD/MXN is trading near the 18.36455 ratio as lightning fast price velocity remains a danger in the currency pair for day traders.
• The USD/MXN has seen a bullish surge higher as financial institutions have become nervous due to the election results in Mexico.
• While the new President Claudia Sheinbaum has clearly won, she will not take power until the 1st of October.

Unfortunately, it appears the outgoing President Andres Manuel Lopez Obrador has a goal of pushing through drastic changes to the constitution regarding the judicial branch before he leaves office. Talk of a reform to the judicial branch and other changes to the constitution have sent shockwaves into financial markets focused on Mexico, because the ruling party has enough political mandates to push through changes to the laws without the capability of much political opposition.

Politics and Volatility Cause Day Trading Pain in USD/MXN

While Claudia Sheinbaum has said she believes Obrador should move slowly, the outgoing President insists he has the backing of the Mexican citizens because of the recent voting success for his political party, Morena. The USD/MXN was trading near a low around the 17.44150 mark on Thursday, but things got dangerously bullish afterwards. It needs to also be acknowledged the USD/MEX was trading around the 16.52000 vicinity on the 21st of May.

Traders can plainly see via technical charts the USD/MXN was near the 17.00000 mark on Thursday the 30th of May and into Monday the 3rd of June, but after the election results were digested and nervousness was ignited the currency pair was touching a high of nearly 17.74000 later that day. Volatility has gripped the USD/MXN since the election results as the outgoing Mexican President has insisted on rattling the cage, even suggesting he will offer ‘advice and dissent’ to the incoming President after she takes the helm.

USD/MXN Support Levels and Technical Perspectives

Choppy conditions will continue in the USD/MXN in the short and near-term. While it is a natural inclination to think fear has been too strong and caused too much of a rise in the currency pair, day traders’ need to be cautious as financial institutions react quickly. Also the coming inflation data from the U.S this Wednesday and then the Federal Reserve’s FOMC rhetoric will shake the Forex including the USD/MXN.

• While the USD/MXN may look overbought and be a potential selling opportunity if emotions calm down, betting on when this will happen is speculative.
• The rapid changes in value in the USD/MXN which have been seen the past few days may continue as financial institutions look for equilibrium.

USD/MXN Short Term Outlook:

Current Resistance: 18.36990

Current Support: 18.31100

High Target: 18.42300

Low Target: 18.21100

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