The USD/MXN is challenging important support levels early today. After a slight bullish run higher displayed late last week, the Forex pair has been able to prove that resistance levels were adequate for speculators and that support levels should be pursued. The key psychological juncture of 20.00000 has been broken lower again, and trading has taken on the look of providing sustainable values below.
The USD/MXN is near the 19.80000 juncture as of this writing. Support levels are firmly up against values tested earlier this month, and importantly, are also hovering within striking distance of values not sincerely traded since early March. If the 19.80000 level proves capable of maintaining its current threshold and downward momentum begins to test the 19.73000 juncture, speculators may begin to target the 19.61000 mark.
There are no guarantees when trading Forex, but if the 19.70000 to 19.60000 junctures come into focus near term, it could set off a potentially dynamic set of circumstances. This price vicinity saw sparse action in early March, and if these values are challenged, it could accelerate programmed software trading from institutional players.
Global risk appetite should also be taken into consideration today and tomorrow. Optimism continues to produce a steady amount of gains on important equity indices and if this remains an ingredient, the USD/MXN may benefit and produce additional bearish momentum.
Some traders may want to pursue the potential for reversals higher short term based on the notion that the USD/MXN will not enjoy a one-way trading avenue. However, if a trader wants to buy the USD/MXN, they should be prepared to have their take profits working in order to get out of the market quickly and grab profits when they can. Risk/reward scenarios presently seem to indicate that the USD/MXN, from a technical perspective, may have further room to roam downwards compared to upside potential.
The USD/MXN appears to be testing vulnerable support levels and, if present market conditions prevail short term, the Forex pair may prove a worthwhile speculative selling opportunity. After seeing slight bullish momentum develop late last week, the resumption of the bearish trend in the USD/MXN looks like it will continue to flourish short term.
Mexican Peso Short-Term Outlook:
- Current Resistance: 19.9100
- Current Support: 19.73000
- High Target: 20.00300
- Low Target: 19.64000
