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What a crash after a good long run looks like

EURUSD News by Simon Kazinsky on 04:49 February 27, 2017 EST

The Mexican peso put an end last week to its continued decline and made a whooping 10% gain in just a few sessions against its US counterpart.

It has been a one way street for the currency pair ever since the unexpected election of Trump in November but, unreported by the main stream media, the problems with the peso did not start then but almost a decade ago. MXNUSD has lost more than 50% since the beginning of the financial crisis in 2008.

Despite last week's gains the pair has not broken important medium term supports yet.

The chart shows us how a long strong trend with its underlying overwhelming one side traders bias ends when it runs out of steam. Perhaps it is giving us a pointer of what will occur when the current bull trend in US stock indices comes to an end.