• Thu. Jul 18th, 2024

USD/MXN Price Analysis: Remains on the defensive below 18.00 mark, downside seems limited

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  • USD/MXN struggles to gain any meaningful traction, though the bias remains tilted in favour of bulls.
  • Any further slide could attract fresh buyers near the 17.80 confluence breakpoint, now turned support.
  • A convincing break below the 23.6% Fibo. level is needed to negate the near-term constructive outlook.

The USD/MXN pair is seen oscillating in a narrow trading band during the Asian session on Wednesday and consolidating the overnight heavy losses to a multi-day low. Spot prices currently trade around the 17.95-17.90 region, nearly unchanged for the day, though any meaningful downside still seems elusive.

Against the backdrop of the recent failure to find acceptance above the 38.2% Fibonacci retracement level of the fall witnessed in July, the prevalent US Dollar (USD) selling bias is seen as a key factor acting as a headwind for the USD/MXN pair. Subsequent decline, however, is more likely to find decent support around the 17.80-17.85 confluence, comprising a technically significant 200-day Simple Moving Average (SMA) and a multi-month-old descending trend-line.

Moreover, oscillators on the daily chart – though have been retreating from higher levels – are still holding in the bullish territory and support prospects for the emergence of some dip-buying near the aforementioned resistance-turned-support. Some follow-through selling, however, could make the USD/MXN pair to accelerate the fall to the 17.40-17.35 horizontal support. Spot prices might then weaken further below the 17.15-17.10 region, towards testing sub-17.00 levels.

On the flip side, momentum back above the 18.00 round figure might now confront some resistance around the 18.15-18.20 zone. This is followed by 38.2% Fibo., around the 18.30 region and mid-18.00s, or the highest level since late March touched last week. A sustained strength beyond will set the stage for the resumption of the recent appreciating move witnessed over the past month or so and lift the USD/MXN pair to the 18.80-18.85 area, representing 50% Fibo. level.

USD/MXN daily chart

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Technical levels to watch

USD/MXN

OVERVIEW
Today last price 17.9315
Today Daily Change -0.0068
Today Daily Change % -0.04
Today daily open 17.9383
TRENDS
Daily SMA20 17.5476
Daily SMA50 17.2781
Daily SMA100 17.2121
Daily SMA200 17.79
LEVELS
Previous Daily High 18.3037
Previous Daily Low 17.9178
Previous Weekly High 18.4934
Previous Weekly Low 17.3786
Previous Monthly High 17.8174
Previous Monthly Low 16.9727
Daily Fibonacci 38.2% 18.0652
Daily Fibonacci 61.8% 18.1563
Daily Pivot Point S1 17.8028
Daily Pivot Point S2 17.6673
Daily Pivot Point S3 17.4168
Daily Pivot Point R1 18.1888
Daily Pivot Point R2 18.4392
Daily Pivot Point R3 18.5747
On Key

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