A few months ago you had a lot of people speculating that the Peso would drop even further against the the Dollar. Some people panicked, some got scared, while some tried to hedge their positions. On a technical aspect, I mentioned that as long as the support at 50 would hold, there was a possibility for the currency to go to 52.
A few months after, that’s no longer the case! The tide has shifted and let me show you where the Peso could go!
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The seven month run of the USD’s aggressive appreciation ended this month. As what I always mention in my trainings, that we should respect the prevailing trend. That when one trend is over, a new trend is forming. Will this short term action lead to the Peso going higher? In my opinion, we still need more evidence for that. But what we know now is the Peso has currently stopped from dropping.
Now that we know that the USD has stopped from aggressively going higher, the next step is to figure out to what levels the Pesos could go. From a technical standpoint, if 50 reveals itself as a legitimate resistance the Peso could go to 49.5 over the short term. If more remittances would come in and more foreigners would remain upbeat about our country’s growth story, the mid term target would bring the Peso to 48.65 against the US Dollar.
Again, nothing has changed in our Fundamentals. Our country’s economy remains upbeat, we will be one of the greatest economies in the next 25 years. I just hope that more Filipinos actually believe that and work towards the goal of making our country an amazing economic destination.
Should the selling of the Peso be prevalent sometime in the future and it be strong enough that the 50 Peso resistance level is broken, we could see the 50 – 52 level to be in play again. As of this point we have no evidence that it could happen. But should it happen I just want you to be prepared of the scenarios.