Retail traders often need to have more patience than they are comfortable with in order to produce solid profitable results in Forex. The trading range of the USD/MXN does offer an opportunity for speculative wagers which tests a rather known price realm however. The use of conservative leverage is obviously needed to endure choppy conditions as reversals flourish in the USD/MXN, but support and resistance levels have proven technically worthwhile.
Friday’s Trading Tested Support not seen since Early September
However the USD/MXN actually broke through fairly durable support levels on Friday and achieved a low of nearly 19.78200, which is a value that had not been seen since the second week of September. Two catalysts helped the USD/MXN turn bearish before going into the weekend. First the notion the U.S Federal Reserve may have to back off its hawkish rate policy in the coming months, to see where the economic winds are blowing regarding a potential recession helped. Secondly, higher Crude Oil prices likely helped firm the value of the Mexican Peso too.
This Morning’s Price Action however reversed Upwards Slightly
True to form in early trading this morning the USD/MXN has reversed from Friday’s lower price action. The USD/MXN is near the 19.86400 mark as of this writing. But the price of the USD/MXN currency pair remains within the lower depths of its price range technically. The ability to test important support levels on Friday may be a sign the USD/MXN is now going to continue to trade within a lower technical framework. Resistance levels above the 19.90000 should be monitored.
- If the USD/MXN is able to maintain its current price level and not trade much higher than the 19.87000 ratio, this may be a sign additional selling will again be seen in the USD/MXN as it tests its short term range.
- Traders need to practice patience with the USD/MXN, but if they achieve this needed characteristic and use effective risk management, the forex pair could move in the intended wagers direction and hit a targeted goal.
The USD/MXN may be able to establish a lower price range between the 19.79000 to 19.88000 levels in the short-term, and if this happens it could be taken advantage of for betting. The USD/MXN has traded lower before, but it has demonstrated an ability to reverse higher when the 19.79000 levels and below have been challenged. Having touched new mid-term lows on Friday the USD/MXN should be watched carefully to see if technically it maintains its known range.
USD/MXN Short Term Outlook:
Current Resistance: 19.86700
Current Support: 19.83100
High Target: 19.93900
Low Target: 19.77400
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