Thursday, January 26, 2017

EWW Mexico ETF 1-Minute Chart; President Pena Nieto Cancels Meeting with President Trump

President Pena Nieto was scheduled to meet with President Trump in Washington, DC, on Tuesday, 1/31/17,  but Nieto cancels the meeting at 11:52 AM EST today (1/26/17). Nieto is unhappy that Trump keeps repeating that Mexico will pay for the border wall. Nieto says Mexico will not pay for the wall and hinted that the meeting would be cancelled if the rhetoric does not cease. President Trump tweets that maybe the meeting should be cancelled and Nieto follows through a short time ago cancelling the meeting.

The Mexican peso currency pair jumps from sub 20 to 21.3505 which represents a weakening peso against the dollar. The EWW Mexico ETF immediately collapses -3%. Mexico is the second largest trading partner with the United States (Canada is number one) and accounts for 14% of US trade.

Trump always comes out on top when he stirs up trouble but has he created a potential Waterloo this time? Mexico citizens begin a boycott of US products with many refusing to go to Starbucks stores for coffee. SBUX drops -0.5%. Mexicans are also avoiding shopping at US border stores. The situation may spin out of control if the two leaders do not kiss and make up quickly.

At the Tuesday meeting, a joint press conference was planned and one of the reporters would definitely ask who is paying for the wall. So either Nieto or Trump would have to kneel in front of the other and kiss that person's shoes. The two leaders may have been better off to simply schedule an initial meeting to talk with each other and not conduct a press conference afterwards. Someone is going to lose face due to Trump demanding that Mexico pay for the wall. Colorful former Mexican president Vicente Foxx continues to tell Trump, "We are not going to pay for your 'f*#*ing' wall." This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

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