USD/MXN Price Analysis: Recovers 19.00 level, points to confluence of 100-day SMA and 38.2% Fibonacci

• USD/MXN is gaining ground for the fourth day in a row and trading near the one-month high reached on Monday.
• The bulls now wait for a move above the confluence of the 100-day SMA and the 38.2% Fibonacci before opening new positions.
• A return below the 18.35 horizontal support is needed to counter the short-term positive outlook.

USD/MXN attracts some buying for the fourth day in a row on Tuesday and maintains its buying tone during the early part of the European session. The pair breaks above the 19.00 level again and remains close to the 1-month high reached on Monday.

With oscillators on the daily chart holding in positive territory and still far from the overbought zone, the technical situation favors the bulls. That being said, the previous day’s failures to find acceptance above the 100-day SMA and the 38.2% Fibonacci retracement of the July 2022-March 2023 dip warrant caution. This makes it prudent to wait for a convincing break through said confluence barrier before positioning for any further upside.

USD/MXN could try to break February’s monthly high around the 19.30 zone and rally to 50% Fibonacci around 19.50. The bullish trajectory could extend towards testing the breakout point of the 19.75-19.80 horizontal support, which coincides with the 61.8% Fibonacci and should act as a turning point. A convincing break would set the stage for an extension of the recent strong rally move from levels below 18.00, or a multi-year low hit last week.

On the flip side, the 23.6% Fibonacci around the 18.65 zone appears to support the immediate fall ahead of the 18.35 horizontal support. Sustained weakness below that level will suggest that the week-long uptrend has exhausted and make USD/MXN vulnerable to retesting the 18.00-17.90 support zone.

USD/MXN daily chart

USD/MXN additional technical levels