USD/MXN – US Dollar In a Tough Spot vs Mexican Peso
- USD/MXN decline puts it into oversold territory, but..
- Not much support to lean against for bullish positioning
USD/MXN in limbo after sell-off
USD/MXN has continued to trade lower in-line with the rest of the Dollar spectrum from emerging market to developed market currencies rallying sharply against USD. While the trend looks extended across the space in the short-term, fading may prove difficult as momentum has been so strong.
USD/MXN currently doesn’t have a good deal of support to lean on, but yet may turn higher in the sessions ahead as it alleviates short-term oversold conditions. Looking higher it seems unlikely for now we will see a move develop above 23.
On the downside the 2018 high just a shade under 21 may soon come into focus. The 200-day is a bit of a distance from here, requiring price to decline to 20.58. Traders looking for a short may want to wait for a congestion pattern before taking a continuation trade.
On the long-side, it is also difficult at the moment with a meaningful low having not yet bee forged. All-in-all, sitting on the sidelines may be a prudent move until further clarity presents itself.
USD/MXN Daily Chart (stuck in the middle at the moment)
Resources for Forex Traders
Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.
---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.