Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View More
USD/MXN Price Forecast: US Dollar Takes Aim at Major Resistance

USD/MXN Price Forecast: US Dollar Takes Aim at Major Resistance

Peter Hanks, Strategist

USD/MXN Price Outlook:

  • Recent US Dollar strength has seen USD/MXN move off yearly lows near 19.50
  • The reversal higher has propelled the pair toward formidable resistance around the 21.00 mark
  • With resistance overhead and a modest uptick in risk aversion to start the week, USD/MXN could undergo consolidation

USD/MXN Price Forecast: US Dollar Takes Aim at Major Resistance

The US Dollar enjoyed a bout of strength to begin the year as a number of USD pairs reversed their trajectory from months prior. Unwilling to be left out, USD/MXN bounced off its yearly lows near 19.50 in mid-January and rebounded higher, taking aim at the 21.00 mark most recently. While the fundamental landscape continues to evolve, recent price action has seen the pair approach a key technical barrier that could give rise to consolidation in the shorter-term.

Top 8 Forex Trading Strategies and their Pros and Cons

To that end, USD/MXN trades narrowly beneath its 200-day moving average that stands around 21.00. Together with the round number the zone holds significant technical influence and could spark a period of consolidation or even a deeper reversal depending on broader USD behavior. Either way, 21.00 stands in the way of further gains and might present attractive risk-reward setups for traders possessing bearish biases.

USD/MXN Price Chart: Daily Time Frame (February 2020 – March 2021)

usd/mxn daily price chart

With that in mind, shorter-term traders might look to employ the area slightly above the 200-day moving average as an invalidation zone while awaiting a potential retracement lower. Initial support in the event of bearishness likely stands around the 20.6046 to 20.6502 area marked by recent swing highs in November, December and January. Subsequent support might exist near the 50-day moving average, descending trendline from March and the Fibonacci level near 20.2361. Together, the barriers could offer considerable assistance.

USD/MXN Price Chart: 4 – Hour Time Frame (August 2020 – March 2021)

usd/mxn price chart

That said, the initial break above the descending trendline from March may have opened a longer-term trend in USD strength. Still, the break higher is directly opposite the EUR/USD bullish breakout posted in July – which could give way to broader USD weakness – so it is difficult to ascertain the wider strength of the Greenback.

Top Trading Opportunities in Q4
Top Trading Opportunities in Q4
Recommended by Peter Hanks
Get Your Free Top Trading Opportunities Forecast
Get My Guide

Suffice it to say, the USD may be at a turning point and might require consolidation before continuing in either direction. Since the 200-day moving average is a substantial technical barrier, a brief pullback in USD/MXN might be likely at this time. Follow @PeterHanksFX on Twitter for updates on this pair.

--Written by Peter Hanks, Strategist for

Contact and follow Peter on Twitter @PeterHanksFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.