USD/MXN Price Analysis: Divergence between price action and RSI warrants further upside

USD/MXN jumps from YTD lows around $18.33 and climbs to 18.40.
USD/MXN Price Analysis: Positive divergence remains, which could pave the way for a recovery.

Christian Borjon Valencia FXStreet

The USD/MXN bounces after hitting multi-year lows around 18.3301, snapping three days of consecutive losses. Nevertheless, the USD/MXN would remain pressured after a strong downtrend dragged prices from the last year's $21.05 peak toward the above-mentioned $18.33 area. At the time of writing, the USD/MXN exchanges hand at 18.4076, above its opening price by 0.25%.

Technically speaking, the USD/MXN daily chart portrays a bearish continuation as the most likely scenario. However, the divergence between the USD/MXN price action and the Relative Strength Index (RSI) remains intact, which would spur a reversal that might open the door for the USD/MXN buyers to reclaim the $19.00 psychological level. This means as price action registered lower lows, the RSI has not. Therefore, risks for a reversal remain, which would open the door for further USD/MXN upside.

For that scenario to play out, the USD/MXN needs to crack the confluence of a downslope-resistance trendline and the 20-day Exponential Moving Average (EMA) at 18.6951, followed by the February 15 daily high at 18.7479, followed by the 50-day EMA At 18.9669, ahead of the 19.0000 psychological price level.

The USD/MXN must conquer the 18.4000 mark for a bearish continuation. Once cleared, that will expose the YTD low at 18.3301, followed by the psychological $18.00.

USD/MXN Daily chart

USD/MXN Key technical levels

USD/MXN

Overview
Today last price	18.4014
Today Daily Change	0.0438
Today Daily Change %	0.24
Today daily open	18.3576

Trends
Daily SMA20	18.74
Daily SMA50	19.0894
Daily SMA100	19.3895
Daily SMA200	19.7607

Levels
Previous Daily High	18.6756
Previous Daily Low	18.3306
Previous Weekly High	18.754
Previous Weekly Low	18.3306
Previous Monthly High	19.5361
Previous Monthly Low	18.5663
Daily Fibonacci 38.2%	18.4623
Daily Fibonacci 61.8%	18.5438
Daily Pivot Point S1	18.2336
Daily Pivot Point S2	18.1096
Daily Pivot Point S3	17.8886
Daily Pivot Point R1	18.5785
Daily Pivot Point R2	18.7995
Daily Pivot Point R3	18.9235

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

AUD/USD consolidates near 0.7000 as USD stays weak

AUD/USD holds steady above 0.7000 during Thursday’s Asian session, consolidating the previous day’s recovery gains from a near three-week low as the Democratic sweep in the US midterm elections and Iran diplomacy hopes continue to weigh on the US Dollar. Bulls, however, seem hesitant as focus shifts to Friday’s crucial US NFP report.

USD/JPY drifts lower to 158.25 on hawkish BoJ Minutes, weak USD

USD/JPY trades with a negative bias for the second straight day on Thursday as hawkish BoJ Minutes, showing members agreed to keep raising rates, and intervention risks support the Japanese Yen. Meanwhile, US midterm election results and hopes for Iran diplomacy keep the US Dollar depressed as focus shifts to Friday’s US NFP report.

Gold hits one-week top near $4,080 on sliding US bond yields and weak USD

Gold builds on the previous day’s blowout rally, climbing to $4,080 during the Asian session on Thursday as falling US bond yields keep the US Dollar depressed near a one-month low, touched in reaction to Democrats’ victories in the US midterm elections. However, December Fed hike bets might cap the non-yielding bullion ahead of Friday’s US NFP report.

Circle reserve income falls 8% as ARC presale lifts Q3 revenue

Circle (CRCL) reported increased revenue in its Q3 earnings update on Wednesday as the $182 million ARC token presale offset the decline in reserve income. The stablecoin issuer stated that total revenue and reserve income reached $865 million in Q3, up 17% from a year earlier. Net income from continuing operations increased 5% to $226 million, while adjusted EBITDA climbed 85% to $317 million.

US midterms 2026: Investor Q&A on the Democratic sweep

1. Gridlock replaces the stimulus narrative. A Democratic Congress would constrain Trump's ability to pursue additional fiscal expansion and legislative tax measures. But it cannot simply reverse the president's entire economic agenda. Executive powers, existing legislation and presidential vetoes remain important. 2. AI faces a higher hurdle, not an extinction event.

US Dollar breaks below 101.50 as Democrats sweep Congress

The US Dollar (USD) comes under heavy selling pressure on Wednesday, with the US Dollar Index (DXY) falling around 0.5% to trade near 101.35 after sliding below the 101.50 level. The Greenback retreats to its lowest level in four weeks as investors reassess the political and economic outlook following the Democratic Party's sweeping victory in the United States (US) midterm elections.