USD/MXN testing resistance at 22.75, Mexican peso likely to drop further
|- Latin American currencies under pressure on Thursday, BRL the worst.
- USD/MXN gains 1.80%, after breaking the 22.50 area.
The USD/MXN pair jumped on Thursday from 22.25 to 22.74, reaching the highest level since Monday. The rally eased slightly below the weekly top. As of writing, the pair trades at 22.66, up 1.80%, holding a bullish tone and testing the 22.75 resistance area.
From a technical perspective, a break of USD/MXN above 22.75 will strengthen the bullish case even further, leaving the door open to a test of the June high at 22.94 (interim resistance at 22.82). The upside bias is set to prevail as long as the pair keeps 22.15.
MXN, BRL and CLP under pressure
Latin American currencies are the worst performers so far on Thursday. The USD/BRL is up 2.40% at the highest level since June 1. The Chilean peso is also under pressure, with USD/CLP back above 800. The USD/MXN is rebounding further and it heads for the second-highest close in a month.
The decline accelerated despite the fact that equity prices in Wall Street remained relatively steady over the last hours. The move appears to be driven by a stronger US dollar. The DXY climbed to the highest level in two weeks above 97.50.
USD/MXN technical levels
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