- Mexican peso validates recent rises against the dollar.
- USD/MXN presses the support at 20.85.
- Interest rate hikes are coming from the Fed this week and Banxico later.
The Mexican peso is rising moderately against the dollar on Monday, against a changing backdrop in global financial markets. The USD/MXN approached the 21.00 zone in Asian hours, but then, in the face of a better mood in the markets, it fell back to 20.83, the lowest level since March 4.
The pair maintains a negative tone in the very short term, but a climate of high volatility and very changeable. The main factors the market is looking at are the war in Ukraine and Wednesday’s decision by the Federal Reserve. An increase in the interest rate is expected. Banxico would do the same next week.
weekly closing
On Friday, USD/MXN finished close to current levels after climbing in previous days to the 21.50 zone, the highest level in months. It was a close with no changes compared to the previous week and that reflects a certain lack of definition going forward.
The rise in USD/MXN was erased, although it is still holding above 20.85, which is considerable support. A confirmation below would enable a bearish extension to 20.70 initially. Below the next support is around 20.50.
To the upside, a firm return above 21.00 could give the dollar strength. The next barrier of consideration is seen at 21.05, followed by 21.30.
Technical levels
Source: Fx Street

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