- The bias in USD / MXN favors the upside, some consolidation probably before the next move up.
- Key moving averages are beginning to turn north supporting the dollar.
The USD/MXN it is trading flat on Monday, retreating from the monthly high it reached last week above 20.55. The short-term trend is clearly upward and is currently trading at 20.40, in the same area as the nine-month downtrend line.
Price remains above and away from the 20- and 55-day moving averages turning north, supporting the bullish bias. Both averages converge at the 19.95 zone which has become critical support. A drop below would indicate the resumption of the long-term trend, which is now being questioned.
As long as it is above 20.15, the momentum will point to more gains for the dollar. USD / MXN is testing the trend line 20.40 and resistance 20.50. Above the next target is seen at 20.80.
The daily RSI is near 70, which suggests that some consolidation seems likely ahead of another bullish move, probably between 20.60 and 20.15.
Daily chart
Technical levels
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