11/28/2014

Gmail - Hasta la vista, Mexican Peso

Peter Brandt <factorco@gmail.com>

Hasta la vista, Mexican Peso

Peter Brandt <plb.factorco@gmail.com>
To: Peter Brandt <plb.factorco@gmail.com>
Bcc: factorco@gmail.com

Wed, Nov 26, 2014 at 8:57 AM

Before I even begin this correspondence, allow me to define terms.

Being bullish on the USD/MXN (spot) is the exact same thing as being bearish on the Peso (which is actually
expressed as MXN/USD in futures trading).
USD/MXN expresses the number of Pesos per USD. MXN/USD is the value of the Peso in dollar terms.
As I write this, the USD/MXN is trading at 13.750X, or 13.75 Pesos per one USD. The MXN/USD trades at a
reciprocal of USD/MXN. Thus, 100 divided by 13.750 equals $.07273, meaning that a Peso is worth just over 7
cents.
When I stared trading currencies at the IMM in the 1970s the Peso was worth about $.8006. Thus, in just shy of
40 years the Peso has declined in value against the USD by 90%. The chart below reflects MXN/USD.

I believe the Peso is due for another decline against the USD. The weekly graph of MXN/USD displays a
possible 56-month symmetrical triangle.

https://mail.google.com/mail/ca/u/0/?ui=2&ik=a7ea8161f1&view=pt&search=inbox&msg=149ecd2c1e6d5284&siml=149ecd2c1e6d5284

1/3

11/28/2014

Gmail - Hasta la vista, Mexican Peso

My weekly graph of the USD/MXN goes back further, so the symmetrical triangle can be seen in better
perspective.

Remember, a bear move in the Peso (MXN/USD) is the equivalent of a bull move in Dollar/Peso.
I have commented frequently on the potential for a much stronger USD/MXN (same thing as a weak Peso) in
recent months. My thought was that the Peso will have another decisive leg down (this means bullish on
USD/MXN) in 2015.
Well, 2015 may be upon us. The lower boundary of the massive triangle is being challenged.

https://mail.google.com/mail/ca/u/0/?ui=2&ik=a7ea8161f1&view=pt&search=inbox&msg=149ecd2c1e6d5284&siml=149ecd2c1e6d5284

2/3

11/28/2014

Gmail - Hasta la vista, Mexican Peso

The daily chart shows the position of the price and the boundary line. Note the small 6-week descending triangle.

I am monitoring this market for a shorting opportunity. My target for the Peso is toward $.0510
ML4plb
###

https://mail.google.com/mail/ca/u/0/?ui=2&ik=a7ea8161f1&view=pt&search=inbox&msg=149ecd2c1e6d5284&siml=149ecd2c1e6d5284

3/3