USD/MXN Price Analysis: Mexican peso approaches monthly highs, back near critical support
- The Mexican peso rises for the fourth consecutive day on Tuesday versus the US dollar.
- USD/MXN is approaching oversold readings but has no significant signs of consolidation.
- Bearish bias prevails, a daily close under 19.80 is likely to trigger more losses.
The USD/MXN moved further to the downside on Tuesday and hit weekly lows at 19.77 before rising back above 19.80. A daily close below this level should point to further weakness in the pair.
The RSI Index is in oversold territory in the four-hour chart. In the daily chart, however, the index still shows some room for further losses before reaching 70. The Mexican peso needs to make a clear break below the 19.80 area.
The next strong support area might be seen at 19.70, followed by 19.60. The area at 19.50/55 should limit the downside if reached in the next sessions, favouring a rebound, initially to 19.70.
On the upside, 19.97/20.00 is the immediate resistance. Above the next level stands at 20.10 (20-day Simple Moving Average). A recovery above 20.20 should negate the bearish bias in the short term, adding support to the US dollar for a more significant recovery.
USD/MXN daily chart
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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.
