Dollar vs Mexican Peso Price Outlook: USD/MXN Fails at Key Resistance
Mexican Peso Technical Price Outlook: USD/MXN Trade Levels
- Mexican Peso updated technical trade levels – Weekly & Daily Charts
- USD/MXN breakout fails at record highs / key confluence resistance
- Immediate long-bias at risk below uptrend resistance / 25.5466
The Mexican Peso has plummeted a staggering 39% vs the US Dollar with a multi-month breakout in USD/MXN taking price to fresh record highs. The rally faltered today on a brief test above a critical multi-year resistance threshold and leaves the immediate long-bias vulnerable while below today’s highs. These are the updated targets and invalidation levels that matter on the USD/MXN weekly price chart. Review my latest Strategy Webinar for an in-depth breakdown of the setupswe’re tracking this week.
Mexican Peso Price Chart – USD/MXN Weekly
Notes: In my last Mexican Peso Price Outlook we noted that USD/MXN was approaching uptrend resistance of multi-year ascending pitchfork formation with a topside breach exposing , “23.3500 backed by the 1.618% extension at 24.2050.” Price registered a high just above confluence resistance at the upper parallel / March high / 200% ext at 25.4474/5466 into the open of the week before reversing with weekly RSI marking bearish divergence into these highs (albeit week signal in overbought territory). The reversal leaves the broader long-bias risk near-term while below this critical threshold.
Monthly open support rests at 23.6988 backed by the 38.2% retracement of the yearly range at 23.0065- a level of interest for possible downside exhaustion IF reached. Broader bullish invalidation now raised to the median-line / 2018 high at 22.0376. A topside breach / close is needed to keep the long-bias viable with such a scenario exposing subsequent resistance objective sat the 2.618% ext at 27.7171.
Bottom line: The peso price sell-off has responded to a key technical confluence and the immediate USD/MXN rally may be vulnerable while below up- slope resistance. From a trading standpoint, look for sided-ways to lower price action over the next few days- ultimately a larger setback may offer more favorable long-entries closer to uptrend support. I’ll publish an updated Mexican Peso Price Outlook once we get further clarity on the near-term USD/MXN technical trade levels.
For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy
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--- Written by Michael Boutros, Technical Strategist with DailyFX
Follow Michael on Twitter @MBForex
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.