Technical Analysis &XAGMXN : 2019-10-28

IFC Markets

Master Trader
Oct 31, 2012
London (Great Britain)
Getting ready for publishing the statistics in Mexico
In this review, we suggest to consider the Silver vs. MXN Personal Composite Instrument (PCI). It reflects the price dynamics of silver versus the Mexican peso. Will the XAGMXN quotations grow?

Such dynamics indicates price growth of silver and a weakening of the Mexican peso. Since September 2019, the peso has strengthened by 5%. Meanwhile, US President Donald Trump expressed concern that Congress might not have time to ratify before the end of this year a new mutual trade agreement between the US, Canada and Mexico, the USMCA, which should replace the previous NAFTA. The postponement of USMCA ratification could have a negative effect on the Mexican peso and the Canadian dollar. This week Mexico will publish data on foreign trade for September, GDP for the 3rd quarter and an indicator of business activity in industry (PMI) for October. They can affect the dynamics of the peso. The growth of precious metals quotations, including gold and silver, can contribute to new global risks against the backdrop of Brexit's next problems. The new agreement between Britain and the European Union requires the approval of the British Parliament. According to GFMS, silver imports to India increased by 8% in the 3rd quarter of 2019 compared to the same period last year. At the same time, in January-September of the current year it grew by 11%. The main demand was in the jewelry industry and investment. In developing countries, silver has become more attractive against the backdrop of expensive gold.


On the daily timeframe XAGMXN: D1 moved up from the downtrend. Various technical analysis indicators have generated signals to increase. Further growth is possible if high demand for precious metals and negative macroeconomic data in Mexico continue.

  • The Parabolic indicator demonstrates a signal to increase.
  • The Bolinger bands narrowed, indicating volatility decrease. Both Bollinger Lines Slope Up.
  • The RSI indicator is above the mark of 50. It has formed a divergence to increase.
  • The MACD indicator gives a bullish signal.
The bullish momentum may develop if XAGMXN exceeds its last two upper fractals and the upper Bollinger line: 352. This level can be used as an entry point. The initial stop lose may be placed below the last lower fractal, the lower Bollinger line and the Parabolic signal: 328. After opening a pending order, the stop shall be moved following the Bollinger and Parabolic signals to the next fractal minimum. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place a stop loss moving it in the direction of the trade. If the price meets the stop level (352) without reaching the order (328), we recommend to cancel the order: the market sustains internal changes that were not taken into account.

Technical Analysis Summary

Position Buy
Buy stop Above 352
Stop loss Below 328