Bullish Looking Crude Oil May Push USD/MXN Even Lower

Today we will talk about risk-on sentiment and how to take it into account when analyzing Crude oil and USD/MXN.

As you may already know, in risk-on sentiment investors are confident, so stocks are bullish. Risk-on mode is in play since March lows and seems like it may continue into January of 2021.

The main reason for a bullish continuation in the stock market in risk-on mode is also bullish looking Crude oil, which has an unfinished five-wave cycle. So more upside is in view for wave »v« towards 50 level, ideally once a correction in wave »iv« fully unfolds with ideal support in the 46-44 zone.

CRUDE OIL, 4H

oil4h

Bullish continuation on Crude oil may cause more weakness for the USD/MXN pair since we know they are in negative correlation. So, USD/MXN could easily continue lower, at least for one more push to the downside, especially because of recent short-term A-B-C corrective recovery.

USD/MXN, DAILY

usdmxnDaily

Disclosure: Please be informed that information we provide is NOT a trading recommendation or investment advice. All of our work is for educational purposes only.

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