USD/MXN Price Analysis: Manages to hold above 100-day SMA, bias seems tilted in favour of bulls

USD/MXN struggles to gain any meaningful traction and oscillates in a range on Monday.
The technical setup supports prospects for some meaningful upside amid a bullish USD.
A break below last week's swing low will shift the bias back in favour of bearish traders.

Haresh Menghani FXStreet

The USD/MXN pair manages to defend the 100-day Simple Moving Average (SMA) support through the Asian session on Monday, albeit struggles to gain any meaningful traction. Spot prices remain below the 17.2500 area, or last week's swing high, which should now act as a pivotal point for short-term traders.

With technical indicators on the daily chart holding in the positive territory, a sustained strength beyond should pave the way for some meaningful upside and lift the USD/MXN pair to the 17.3810 area (September 12 peak). Some follow-through buying has the potential to lift spot prices further towards the next relevant hurdle near the 17.5910-17.5960 horizontal zone en route to the monthly top, around the 17.7090-17.7095 region.

The US Dollar (USD) holds steady just below its highest level in more than six months and remains well supported by the Federal Reserve's (Fed) hawkish outlook, signalling the need to keep rates higher for longer to push inflation to the 2% target. This, along with the reduction in the expected number of rate cuts in 2024, continues to push the US bond yields higher and continues to underpin the USD, favouring the USD/MXN bulls.

Hence, any meaningful slide below the 100-day SMA might continue to attract fresh buyers near the 17.1010-17.0650 horizontal support. This, in turn, should help limit the downside for the USD/MXN pair near last week's swing low, around the 16.9980 area. which if broken decisively might shift the bias in favour of bearish traders. Spot prices might then turn vulnerable to retesting the 16.6945 area, or a multi-year low touched in August.

USD/MXN daily chart

Technical levels to watch

USD/MXN

Overview
Today last price	17.2097
Today Daily Change	-0.0013
Today Daily Change %	-0.01
Today daily open	17.211

Trends
Daily SMA20	17.171
Daily SMA50	17.0383
Daily SMA100	17.1956
Daily SMA200	17.892

Levels
Previous Daily High	17.2374
Previous Daily Low	17.1012
Previous Weekly High	17.2506
Previous Weekly Low	16.9982
Previous Monthly High	17.4274
Previous Monthly Low	16.6945
Daily Fibonacci 38.2%	17.1532
Daily Fibonacci 61.8%	17.1854
Daily Pivot Point S1	17.129
Daily Pivot Point S2	17.047
Daily Pivot Point S3	16.9927
Daily Pivot Point R1	17.2652
Daily Pivot Point R2	17.3194
Daily Pivot Point R3	17.4014

Author

Haresh Menghani

FXStreet

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

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