- USD/MXN completed two days of strong gains on Monday and corrected lower on Tuesday.
- Zone of 19.80 contained the advance, the bullish tone continues.
- Mexican peso continues to be among the worst performing currencies.
USD/MXN rose again on Monday, posting the steepest advance in months and reaching as high as 19.86, the highest in a month. It then pulled back to close the day at 19.72. Tuesday continues with the pullback and trades around 19.67.
The Mexican peso is among the currencies that has lost the most ground against the dollar in recent days, reflecting not only the strength of the US currency but also weakness on the Mexican peso side.
The Negative factors for the Mexican currency include technical issues. The USD/MXN break above 19.50/60 further accelerated the rises. The 19.80 zone contained the advance, since although it operated above, there was no daily close on these levels. If there is one, the weakness of the MXN would be expected to continue taking the pair towards 20.00.
In the opposite direction, now 19.60 looms as a key support. If the Mexican peso breaks below, it could recover momentum and alleviate current upward pressures.
The increases occurred before economic data from the US that lead one to think of a continuation of the rate hike in the US and a sharp fall in the price of oil. In addition to the above, the USD/MXN was correcting upwards, after having fallen last week to its lowest since February 2020, around 19.00.
technical levels
Source: Fx Street
I am a writer for World Stock Market. I have been working in finance for over 7-8 years, and I have experience with a variety of financial instruments. My work has taken me to Japan, China, Europe, and the United States. I speak Japanese and Chinese fluently.
