- The Mexican peso continues to rise against the US dollar, its highest level since July 2021.
- USD/MXN shows oversold readings but without significant signs of consolidation.
- The price remains below the 200-week SMA at 20.15.
The USD/MXN opened the week pulling back below 19.80, after posting the third consecutive weekly decline. The bearish bias remains intact with the pair looking to test 19.70 in the short term and close to the critical 19.55 support area.
The US dollar needs to recover levels above 19.85 to relieve immediate bearish pressure, favoring some consolidation. As long as it is below 20.15, the upside could look shaky; a weekly close above that level could suggest that a temporary bottom has been established.
The fact that USD/MXN has fallen in 17 of the last 19 trading days puts into perspective how far the Mexican peso rally has come. Technical indicators like the RSI below 30 show oversold levels. Despite the descriptions, there are no significant signs of a reversal or stabilization yet as the cross continues to break support levels.
A consolidation below 19.70 should keep the doors open for further losses. The next solid medium-term support is seen at 19.55, 2021 low, but before that an intermediate level is seen at 19.65.
USD/MXN daily chart
Technical levels
Source: Fx Street
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