USD/MXN Price Analysis: Bears turn cautious amid oversold RSI, not ready to give up yet

USD/MXN continues with its struggle to gain any traction and languishes near a multi-year low.
The formation of a descending channel points to a well-established short-term bearish trend.
The RSI on the daily chart is still flashing oversold conditions and holding back bearish traders.

Haresh Menghani FXStreet

The USD/MXN pair struggles to capitalize on the previous day's modest rebound from the 17.0245 area, or its lowest level since December 2015 and oscillates in a narrow range through the early part of the European session on Tuesday. The pair currently trades just below the 17.1000 round figure, nearly unchanged for the day, and seems vulnerable to sliding further.

From a technical perspective, the recent downfall from the vicinity of the 18.00 round-figure mark, or the May swing high, has been along a downward-sloping channel. This points to a well-established short-term bearish trend and suggests that the path of least resistance for the USD/MXN pair is to the downside. That said, the Relative Strength Index (RSI) on the daily chart is still flashing oversold conditions and holding back traders from placing fresh bearish bets around the pair.

Nevertheless, the lack of any meaningful buying suggests that the downtrend is still far from being over. Hence, any recovery attempt could attract fresh sellers near the 17.20-17.25 area, which coincides with the 50-period Simple Moving Average (SMA) on the 4-hour chart. This is closely followed by the top end of the aforementioned channel and should act as a pivotal point. A convincing breakout will suggest that the USD/MXN pair has formed a bottom and pave the way for additional gains.

On the flip side, the multi-year low, around the 17.0245-17.0240 zone could protect the immediate downside ahead of the trend-channel support, currently pegged just below the 17.0000 psychological mark. Some follow-through selling will be seen as a fresh trigger for bearish traders and make the USD/MXN pair vulnerable to accelerate the fall towards the 16.60-16.55 region en route to the November 2015 swing low, around the 16.35 region.

USD/MXN 4-hour chart

Key levels to watch

USD/MXN

Overview
Today last price	17.0883
Today Daily Change	0.0079
Today Daily Change %	0.05
Today daily open	17.0804

Trends
Daily SMA20	17.4535
Daily SMA50	17.7094
Daily SMA100	18.0832
Daily SMA200	18.8332

Levels
Previous Daily High	17.1724
Previous Daily Low	17.061
Previous Weekly High	17.3353
Previous Weekly Low	17.0243
Previous Monthly High	18.078
Previous Monthly Low	17.4203
Daily Fibonacci 38.2%	17.1299
Daily Fibonacci 61.8%	17.1036
Daily Pivot Point S1	17.0368
Daily Pivot Point S2	16.9932
Daily Pivot Point S3	16.9255
Daily Pivot Point R1	17.1482
Daily Pivot Point R2	17.216
Daily Pivot Point R3	17.2596

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD drops to two-week low, further below 0.7000 after RBA's less hawkish rate hike

AUD/USD drifts lower for the second straight day on Tuesday, hitting a fresh two-week low during the Asian session after the Reserve Bank of Australia's (RBA) widely expected 25 bps rate hike. The decision was far from unanimous, with three members preferring to hold rates at 4.60%. This tempers expectations of further tightening, which, along with modest US Dollar strength, weighs on the currency pair.

USD/JPY fails near 159.00 amid weak USD, intervention risks

USD/JPY edges lower during Tuesday’s Asian session, reversing part of the previous day's gains to 158.00 as the US Dollar remains depressed amid hopes for Iran diplomacy and ahead of US midterm elections. Meanwhile, intervention risks support the Japanese Yen, though the uncertainty over the timing of the next BoJ rate hike caps gains. This keeps the pair confined within a familiar range and warrants caution before placing directional bets.

Gold slides below $3,900 as Fed hike bets counter softer USD ahead of US elections

Gold slides below the $3,900 mark during the first half of the European session, eyeing its lowest level since October 2025, set last week amid expectations of further tightening by the US Federal Reserve. Data released on Monday showed that US manufacturing sector business activity expanded for the 10th consecutive month in October. The Institute for Supply Management's Manufacturing PMI came in higher than consensus estimates and rose to 55.5 in October from 54.5 in the previous month.

Cardano extends losses as sellers stay in control

Cardano (ADA) extends correction, trading below $0.189 on Tuesday after losing key support zone the previous day. Mixed derivatives data and cautious on-chain metrics continue to weigh on bullish sentiment, while weakening technical indicators suggest further downside risks for ADA.

BoE is set to hike rates this week: Warns against 'unwarranted' aggressive tightening

We see a hike as a done deal this week and another, while not yet our baseline scenario, is possible in February should inflation stay above 4%, commodity prices remain high and activity remain resilient. We remain of the view, however, that aggressive tightening is unwarranted, for four main reasons: There are no clear signs of second-round inflation effects, nor do we think that there will be.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.