- USD/MXN turns negative, after hitting weekly highs near 20.30.
- A recovery in market sentiment helped the Mexican peso during the American session.
- A consolidation above 20.20 is likely to trigger more gains.
Emerging market currencies recovered ground during the American session from multi-day lows. They remain under pressure affected by the sharp decline in global stocks. The negative growth outlook and monetary tightening from the Fed weigh on currencies like the Mexican peso.
The USD/MXN peaked on Thursday at 20.26, the highest level in a week. Later as stocks recovered, pulled back erasing gains. Despite moving off highs, the outlook is biased to the upside. At the first attempt, the dollar was rejected from above 20.20. If it posts a daily close above it could rise further to the next resistance at 20.45. The 20.20 area is reinforced by the 100-day Simple Moving Average.
While under 20.20, some consolidation between 20.20 and 20.00 seems likely before the next directional move. A decline back to 20.00 should be seen as a normal correction after the rally from 19.80 to 20.20.
A decline under 20.00 and below the 20-day SMA should strengthen the Mexican peso, favoring an extension toward the weekly low at 19.81. The key support below is the 19.70 area that if reached, could likely trigger a rebound.
USD/MXN daily chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD remains under pressure above 0.6400
AUD/USD managed to regain some composure and rebounded markedly from Tuesday’s YTD lows in the sub-0.6400 region ahead of the release of the Australian labour market report on Thursday.
EUR/USD faces decent contention around 1.0600
The knee-jerk in the Greenback reignited some buying interest in the risk complex and pushed EUR/USD to three-day highs near 1.0680, rapidly leaving behind the recent yearly low around 1.0600.
Gold eases despite risk-off mood
Gold trades in a relatively tight range near $2,390 in the second half of the day on Wednesday. In the absence of high-tier data releases, investors keep a close eye on headlines surrounding the Iran-Israel conflict.
Ethereum trades around the $3,000 support following a surge in validator queue
Ethereum (ETH) continued a sideways movement on Wednesday as investors seemed to be waiting for an upward or downward price catalyst. Despite the price stagnancy, the ETH validator queue - possibly fueled by the DeFi restaking boom - rose sharply.
Australia unemployment rate expected to rise back to 3.9% in March as February boost fades
Australia will publish its monthly employment report first thing Thursday. The Australian Bureau of Statistics is expected to announce the country added measly 7.2K new positions in March after the outstanding 116.5K jobs created in February.