CLP/US$ Under Close Inspection

While we are still up an implied 0.39% on our bullish Key Market View on the Chilean peso against the US dollar, we are becoming increasingly concerned over its current trajectory. We initiated the view at CLP483.75/US$ on March 16, hoping to take advantage of a rebound from the sell-off experienced in the immediate aftermath of the Japanese earthquake. To begin with the peso moved in our favour, gaining 1.12% to CLP478.30/US$ by March 25, but since then technical resistance has interrupted its rally.

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