USD/MXN Price Analysis: Manages to hold above 50-day SMA ahead of FOMC

USD/MXN oscillates in a range on Wednesday, around the 61.8% Fibo. level.
The setup favours bears and supports prospects for some meaningful downfall.
A move beyond the 17.20-25 confluence hurdle will negate the bearish outlook.

Haresh Menghani FXStreet

The USD/MXN remains on the defensive through the Asian session on Wednesday and is currently placed around the 17.0760-17.0755 area, representing the 61.8% Fibonacci retracement level of the rally from the August monthly swing low. Spot prices, however, manage to hold above a two-week low touched on Monday and the 50-day Simple Moving Average (SMA), pegged near the 17.0235 region, which should act as a key pivotal point ahead of the highly-anticipated FOMC monetary policy decision.

Oscillators on the daily chart, meanwhile, have been gaining negative traction and suggest that the path of least resistance for the USD/MXN pair is to the downside. That said, it will still be prudent to wait for a sustained break below the aforementioned support before positioning for further losses. Spot prices might then turn vulnerable to weaken further below the 17.0000 psychological mark and test the 16.8885 support zone. The downward trajectory could get extended further towards the multi-year trough, near the 16.6945 region touched in August.

On the flip side, the overnight swing high, around the 17.1420-17.1425 area now seems to act as an immediate hurdle ahead of the weekly top, near the 17.1825 region touched on Monday. Any subsequent move up is more likely to confront stiff resistance and remain capped near the 17.2060-17.2280 confluence, comprising the 50% Fibo. level and the 100-day SMA. Some follow-through buying, however, should lift the USD/MXN pair to the 38.2% Fibo. level, around the 17.3300 region en route to the 23.6% Fibo. barrier near the 17.4775 area.

The next relevant hurdle is pegged near the multi-month top, around the 17.7090-17.7095 zone, which if cleared decisively will be seen as a fresh trigger for bullish traders and set the stage for a further near-term appreciating move for the USD/MXN pair.

USD/MXN daily chart

Technical levels to watch

USD/MXN

Overview
Today last price	17.0811
Today Daily Change	-0.0006
Today Daily Change %	-0.00
Today daily open	17.0817

Trends
Daily SMA20	17.1131
Daily SMA50	17.0175
Daily SMA100	17.2163
Daily SMA200	17.9303

Levels
Previous Daily High	17.1424
Previous Daily Low	17.0548
Previous Weekly High	17.5959
Previous Weekly Low	17.0504
Previous Monthly High	17.4274
Previous Monthly Low	16.6945
Daily Fibonacci 38.2%	17.0882
Daily Fibonacci 61.8%	17.1089
Daily Pivot Point S1	17.0435
Daily Pivot Point S2	17.0054
Daily Pivot Point S3	16.956
Daily Pivot Point R1	17.1311
Daily Pivot Point R2	17.1805
Daily Pivot Point R3	17.2187

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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