Trading AUD/MXN
The AUD/MXN is a popularly traded exotic forex pair. It reflects how much the base currency, AUD, is worth against the counter currency, MXN. The Australian dollar is the fifth most traded currency with relative stability while the Mexican peso promises liquid access to South America which has seen rapid market growth in recent years. This article is a guide to day trading the AUD/MXN, from tips and risks to live price charts and exchange rate history.
AUD/MXN Trading Brokers
- Forex.com - Forex.com is a leading FX broker. The brand offers a wide range of currency pairs and some of the lowest fees in the industry. Spreads on the EUR/USD come in as low as 0.0 with a $7 commission per $100k.
- Interactive Brokers - Trade 85 major, minor and exotic forex pairs via CFDs on IB's FXTrader platform with tight spreads and low commissions, or trade forex on the spot market. They offer more FX assets than almost any competitor.
- NinjaTrader - NinjaTrader supports the trading of popular currencies including the EUR/USD. The trading software also offers unique features tailored to forex trading, including specific order and market windows.
- OANDA US - OANDA offers 68 forex pairs, more than many alternatives. The broker's in-house platform also offers impressive execution speeds and a suite of advanced charting and analysis tools.
- Webull - Webull offers a modest collection of 17 currencies, including majors like EUR/USD. Forex can be traded on the feature-rich investing app with real-time quotes and low spreads.
Top 3 Broker Comparison
| Forex.com | Interactive Brokers | NinjaTrader | |
|---|---|---|---|
| Forex Assets | 80+ | 70+ | 50+ |
| EUR/USD Spread | 1.0 | Commission (.20 pts x trade value) | 1.3 |
| Forex App Rating | |||
| Minimum Deposit | $100 | $0 | $50 |
| Regulator | NFA, CFTC | SEC, FCA, IIROC, SFC | NFA, CFTC |
| Visit | Visit | Visit | Visit |
#1 - Forex.com
Forex.com is a leading FX broker. The brand offers a wide range of currency pairs and some of the lowest fees in the industry. Spreads on the EUR/USD come in as low as 0.0 with a $7 commission per $100k.
"Forex.com is an excellent broker for active forex traders with over 80 currency pairs, tight spreads, low commissions and powerful charting platforms for day traders. "
- DayTrading Review Team
- GBPUSD Spread: 1.0
- EURUSD Spread: 1.0
- EURGBP Spread: 1.0
- Total Assets: 80+
- Leverage: 1:50
- Platforms: MT4, MT5, TradingView, eSignal, AutoChartist, TradingCentral
About Forex.com
Forex.com boasts a global reputation with multiple awards and 20+ years experience. Regulated in the US, EU, UK and Canada they provide a huge range of day trading markets, not just forex, and offer competitive fees on a cutting-edge platform. The brand also provides a suite of additional tools, from performance analytics and SMART Signals to advanced charts and strategy builders.
Pros
- Industry-leading pricing on popular forex assets starting from 0.0 pips
- Excellent trading tools including Trading Central, SMART Signals and MetaTrader 4
- Top-rated forex and CFD broker
Cons
- $15 monthly inactivity fee
- Investment offering varies between countries
- No copy trading platform
#2 - Interactive Brokers
Trade 85 major, minor and exotic forex pairs via CFDs on IB's FXTrader platform with tight spreads and low commissions, or trade forex on the spot market. They offer more FX assets than almost any competitor.
"Experienced day traders seeking a regulated broker with sophisticated trading software and very low fees should look at IB. Their range of stocks also can't be beaten."
- DayTrading Review Team
- GBPUSD Spread: Commission (.20 pts x trade value)
- EURUSD Spread: Commission (.20 pts x trade value)
- EURGBP Spread: Commission (.20 pts x trade value)
- Total Assets: 70+
- Leverage: 1:50
- Platforms: AlgoTrader, OmniTrader, eSignal, TradingCentral
About Interactive Brokers
Interactive Brokers is a leading global brokerage that provides access to a comprehensive offering of stocks as well as forex, futures, metals, bonds and cryptos. The firm has over 40 years experience in the online trading industry and is heavily regulated by SEC, FCA, IIROC, and SFC. Day traders can use the proprietary Trader Workstation and can access powerful tools and data feeds as well as comprehensive educational resources.
Pros
- Commission reimbursement with Toggle AI
- Gives day traders unmatched access to global stocks with tens of thousands available from 100+ market centres in 24 countries
- Direct market access, including to the FTSE 100 index, the CAC 40 and Germany’s DAX 40
Cons
- Platform and web interface are complex and difficult for beginners to pick up
- Due to the pricing structure, this firm can be more expensive for aggressive traders who trade over $100,000 shares a day
- The TWS platform falls short in terms of technical charting
#3 - NinjaTrader
NinjaTrader supports the trading of popular currencies including the EUR/USD. The trading software also offers unique features tailored to forex trading, including specific order and market windows.
"NinjaTrader is well-positioned to meet the demands of active futures traders looking for low fees and premium analysis tools. The platform hosts top-rate charting features with custom indicators. "
- DayTrading Review Team
- GBPUSD Spread: 1.6
- EURUSD Spread: 1.3
- EURGBP Spread: 1.6
- Total Assets: 50+
- Leverage: 1:50
- Platforms: NinjaTrader Futures, eSignal
About NinjaTrader
NinjaTrader is a US-headquartered and regulated brokerage that specializes in futures trading. There are three pricing plans to suit different needs and budgets, as well as ultra-low margins on popular contracts. The brand's award-winning charting software and trading platform also offers a high-degree of customization and superb technical analysis features.
Pros
- Thousands of add-ons and applications from developers in 150+ countries
- Low fees with $50 day trading margins & commissions from $.09 per micro contract
- Industry-leading futures broker with multiple awards
Cons
- Non forex and futures trading requires signing up with partner brokers
- Withdrawal fee on some funding methods
- Premium platform tools come with an extra charge
#4 - OANDA US
OANDA offers 68 forex pairs, more than many alternatives. The broker's in-house platform also offers impressive execution speeds and a suite of advanced charting and analysis tools.
"OANDA is an excellent broker for US day traders seeking a user-friendly platform with premium analysis tools and a straightforward joining process. OANDA is also heavily regulated with a very high trust score."
- DayTrading Review Team
- GBPUSD Spread: 3.4
- EURUSD Spread: 1.6
- EURGBP Spread: 1.7
- Total Assets: 65+
- Leverage: 1:50
- Platforms: MT4, TradingView, AutoChartist
About OANDA US
OANDA is a popular brand offering exceptional execution, low deposit requirements and advanced charting and trading platform features. The top-rated brand has over 25 years of experience and is regulated by trusted agencies, including the NFA/CFTC. Around the clock support is available, alongside flexible contract sizes and automated trade executions.
Pros
- Feature-rich app with 50 indicators, 11 drawing tools and 9 charting styles
- Low minimum deposit for beginners
- API facilitates access to 25 years of historical data and rates from 200+ currencies
Cons
- Customer support not available on the weekend
#5 - Webull
Webull offers a modest collection of 17 currencies, including majors like EUR/USD. Forex can be traded on the feature-rich investing app with real-time quotes and low spreads.
"Webull is best for traders looking to buy and sell stocks on a user-friendly platform with zero commissions. The intuitive app also makes this broker great for mobile investors."
- DayTrading Review Team
- GBPUSD Spread: 0.4
- EURUSD Spread: 0.2
- EURGBP Spread: 0.4
- Total Assets: 15+
- Leverage: 1:4
- Platforms: Desktop App, Web Terminal
About Webull
Webull is a US-regulated trading app that offers stocks, options, forex, cryptos, ETFs, fractional shares and more. The firm is authorized by the SEC and FINRA with a strong trust rating. Low fees, no minimum investment and generous welcome bonuses have made the discount broker popular with online investors.
Pros
- Smart Advisor for auto investing
- Easy-to-use investment platform and mobile app
- Zero commissions or inactivity fees
Cons
- High deposit and withdrawal wire fees for non-US residents
- Narrow range of payment methods
- No MetaTrader 4 access
Chart
Pros Of Trading AUD/MXN
- Volatility – Exotic pairs, like the AUD/MXN, have high volatility. Frequent price changes provide day traders with many opportunities to turn a profit. The AUD and MXN are also commodity currencies whose relative strength depends on the success of their export-based economies.
- Predictability – Exotic pairs can be easier to predict than majors or minors. In the case of AUD/MXN, the influence of the Australian dollar can overpower the impact of the Mexican peso. Those that already trade the AUD/TRY and USD/MXN may find it easier to get up to speed with the AUD/MXN.
- Liquidity – The Mexican peso experiences substantial liquidity due to its high-interest rates, commercial activity and trade agreements with the US. This can help ensure spreads remain competitive.
- High-interest rates – Due to high-interest differentials, both the AUD and MXN can serve as carry trades in other currency pairs such as AUD/JPY and USD/MXN.
Cons Of Trading AUD/MXN
- Understanding – Generally, there is less market information and publicly available future forecasts on exotic pairs compared to popular majors and minors. For those that live outside of the respective countries, it can be harder to gauge the economic environment and geopolitical landscape.
- Expensive – Brokers tend to charge higher prices due to the risky nature of exotic pairs. As a result, bid-ask spreads may be wider versus majors.
- Availability – Not all brokers offer exotic pairs such as the AUD/MXN. Traders may need to shop around to find the right online broker that offers the currency pair.
- Volatility – Forex trading is already a risky investment vehicle, but exotics can prove particularly volatile. Whilst this can mean serious profits, it can also lead to large losses. Users need to ensure they take a careful approach to risk management.
AUD/MXN Day Trading Strategy
Timing
While forex trading runs 24/5, certain periods offer higher levels of liquidity and volatility. Trading during these times can help ensure profits cover costs.
The Australian trading session typically runs between 23:00 and 05:00 GMT while key Mexican trading times run from 14:30 to 21:00 GMT. Because these sessions don’t overlap, there isn’t an obvious ideal trading window. With that said, the Australian trading session typically sees high levels of activity and trading 30 minutes to 60 minutes before economic releases or 1 to 3 hours after announcements also offers decent liquidity.
Risk Management
Due to the volatile nature of exotic forex pairs, it’s key that traders take measures to manage risk. Not risking more than 1 to 2% of your total capital in a single trade, for example, can help to limit your risk exposure. So when looking at AUD/MXN technical charts, buy and sell rates and future forecasts, it’s important to factor in where you’ll place your risk parameters.
USD/MXN
For traders unfamiliar with the AUD/MXN, the USD/MXN is an interesting pair to keep an eye on. Live charts, price predictions and market data are more readily available on the USD/MXN and the pair can help you can understand the Mexican peso component.
News
AUD/MXN traders should keep on top of financial and economic news announcements. For example, reports on inflation rates, GDP data and export production can all impact the price of the AUD/MXN. Particularly useful online resources include Bloomberg, IG, Investing.com and Yahoo Finance. These sources offer live price charts, historical exchange rate data and market sentiment.
Understanding The AUD
It is important to understand the AUD to MXN exchange rate history and the influences on price movement.
In 1966, the Australian dollar replaced the Australian pound and in the following year, it was pegged to the US dollar until 1983 when it became a free-floating currency.
Key influences on the currency include:
- Commodity prices – The Australian dollar is a commodity currency, so the prices of its main exports like metals and grains are strongly tied to its value. Australia primarily trades with Asia’s developing economies such as China and India.
- Central bank policies – The Reserve Bank of Australia makes important decisions on interest rates and inflation. Keeping an eye on monetary policy announcements will help you make future forecasts about the value of the Australian dollar.
- Balance of payments – Australia’s account deficit is an important detail to analyse as it informs of the country’s trade balance, income payments and other transactions between its economy and other countries. A deficit in the country’s balance of payments can harm the strength of the currency.
Understanding The MXN
Before the late 18th century, the Mexican peso was the benchmark for all North American countries such as the United States. The country continued to use the peso after gaining independence from Spain in 1821. The Bank of Mexico was established in 1925, which was granted the right to print banknotes. The Nuevo peso, which is the MXN we know today, was created after the oil crisis in the 1970s.
Key influences on the currency include:
- Proximity with the United States – The trading relationship between Mexico and the US is key as stable commercial interactions contribute to MXN’s liquidity. For context, in 2019, the US exported $256 billion of goods to Mexico and imported $358 billion worth of goods, which added significant liquidity to the USD/MXN.
- Oil prices – As the ninth-largest oil producer in the world, Mexico’s economy has historically been dependent on oil. It also shows a tight correlation with other Latin-American commodity-based currencies like the Brazilian real and Colombian peso. The weekly U.S. oil inventory can also have a strong effect on the USD/MXN.
- Central bank policies – The Bank of Mexico makes decisions on the country’s interest rates and other important factors that can increase or depreciate the value of the Mexican peso.
Linked Currency Pairs
Traders should take note of relevant currency correlations with the AUD/MXN. Currency pairs don’t move independently of each other. The success or failure of one pair can be reflected in another. For example, we previously mentioned the correlation between the AUD/MXN and the USD/MXN.
- Positive correlation – This is when pairs move in the same direction as each other. The AUD/USD, GBP/USD, and EUR/USD pairs are positively correlated. This is a result of the US dollar being the counter currency.
- Negative correlation – This is when forex pairs move in the opposite direction. The USD/CHF, USD/JPY, and USD/CAD are good examples. They are negatively correlated because the US dollar is the base currency.
Final Word On Trading AUD/MXN
The AUD/MXN pair has promising qualities that may allow traders to generate profits from market volatility. However, as an exotic pair, it is more suited to experienced traders. We’d recommend opening an account with a regulated forex broker that offers all the tools and features needed to make accurate AUD/MXN forecasts.
FAQ
How do I convert 1 AUD to MXN?
The AUD to MXN exchange rate is continuously moving. Head to one of many online currency convertors to buy and sell AUD to MXN.
Should I invest in AUD/MXN?
As a popular exotic forex pair, it has good attributes that make for an interesting investment vehicle. With that said, language barriers, volatility risks and limited information online can make it challenging versus other established pairs.
How can I trade AUD/MXN?
Firstly, you need to open an account with a broker that offers the AUD/MXN. It’s also important to check spreads and commissions as they tend to be more expensive than on majors or minors. Other factors like security, regulation, plus deposit and withdrawal methods are useful considerations.
What is the meaning of AUD/MXN?
This forex pair consists of the base currency, AUD and the counter currency, MXN. This shows how much the AUD is worth against the MXN. For example, if an AUD/MXN quote is 16.08, this means 16.08 MXN is worth 1 AUD.
What affects the AUD vs MXN rate?
Each currency is affected by its central bank’s monetary policies. On top of that, as a commodity currency, The Australian dollar is highly affected by global commodity prices. Mexico is also a key oil producer, which means changes in global oil prices can either positively or negatively impact the strength of its currency. It’s also worth keeping abreast of relations and trade agreements between the US and Mexico.