USD/MXN Price Analysis: How far can it go?

Mexican peso tumbles on Banxico’s headlines.
USD/MXN overbought, but still no signs of correction.
The 21.50 area is the key zone to watch.

Matías Salord FXStreet

Mexican President Andres Manuel Lopez Obrador added more fuel to the USD/MXN rally on Wednesday by changing his nominee for the next head of the central bank. It triggered a new leg higher that peaked at 21.62, the new high since March.

From the new top, USD/MXN pulled back, finding support above 21.35. Currently, the pair is hovering around 21.50, a key area. A consolidation above should lead the road open to more gains. The next strong resistance is located at 21.90 that should hold.

Technical indicators are at extreme readings but no signs of correction are seen. The RSI is above 70 but still looking north; a similar situation occurs with Momentum. Despite showing no signs, the 21.50 zone should limit the upside for the time being, particularly if overall market conditions help.

If USD/MXN fails to hold above 21.50, it could pullback initially to 21.20 and then to the more relevant and strong support seen at 20.90. A slide below would alleviate the bullish pressure.

The constructive outlook for USD/MXN will remain intact while price stays above the uptrend line, today at 20.35.

USD/MXN

Overview
Today last price	21.5275
Today Daily Change	0.0994
Today Daily Change %	0.46
Today daily open	21.4281

Trends
Daily SMA20	20.6873
Daily SMA50	20.4862
Daily SMA100	20.2488
Daily SMA200	20.2379

Levels
Previous Daily High	21.6162
Previous Daily Low	21.1702
Previous Weekly High	20.89
Previous Weekly Low	20.4702
Previous Monthly High	20.9034
Previous Monthly Low	20.1193
Daily Fibonacci 38.2%	21.4458
Daily Fibonacci 61.8%	21.3406
Daily Pivot Point S1	21.1935
Daily Pivot Point S2	20.9588
Daily Pivot Point S3	20.7475
Daily Pivot Point R1	21.6395
Daily Pivot Point R2	21.8508
Daily Pivot Point R3	22.0855

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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