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