USD/MXN Price Analysis: Peso stretches recovery from 17.40 key level as US/Mexico inflation data loom
- USD/MXN holds lower ground near intraday bottom, defends previous day’s U-turn from support-turned-resistance.
- Clear break below 50-DMA keeps Mexican Peso buyers hopeful.
- US CPI, Mexico Core Inflation for July eyed for clear directions.
USD/MXN bears keep the reins at the intraday low of around 17.04 during early Monday, keeping the previous day’s U-turn from the support-turned-resistance stretched from mid-May.
Adding strength to the downside bias about the Mexican Peso (MXN) pair is the quote’s clear downside break of the 50-DMA, as well as the cautious mood ahead of the inflation from Mexico and the US for July.
Even so, the bullish MACD signals and one-month-old horizontal support around the 17.00 round figure prods USD/MXN bears before giving them control.
In that case, 16.70 and the multi-month low marked in July around 16.60 will be in the spotlight.
Alternatively, the 50-DMA level of around 17.10 guards the immediate recovery of the USD/MXN pair ahead of the aforementioned support-turned-resistance, close to 17.38-40.
It should be noted that the Mexican Peso sellers remain off guard unless breaking the 100-DMA surrounding 17.55.
Above, the US and Mexican inflation data for July will be crucial to watch as the USD/MXN resumes the original downtrend. Should the scheduled data justify dovish concerns about the Fed and/or hopes of another rate hike from Banxico, the quote won’t hesitate to challenge the yearly low marked in July around 16.62.
USD/MXN: Daily chart
-07082023-638269741648529702.png)
Trend: Further weakness expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
