- USD/MXN drops below last Thursday’s low, extending its losses to a fresh multi-year low of around $18.40.
- USD/MXN Price Analysis: A break below $18.40 would pave the way toward $18.00.
The USD/MXN hit an almost 4-year-and-a-half month low around 18.4485, a level last seen in October 2018, extending its losses by 0.89% in the week. At the time of writing, the USD/MXN exchanges hands at 18.4161.
Since the beginning of the week, the Mexican Peso (MXN) has shown resilience to register a daily loss vs. the greenback (USD). Even though the USD/MXN Tuesday’s session finished in the green, prices were reluctant to break solid resistance around the 20-day Exponential Moving Average (EMA) at 18.7999 that day. Albeit the USD/MXN closed with gains of 0.31%, analyzing price action, the large wick on top of Tuesday’s candle’s body was a forecast of what was upcoming in the rest of the week.
Hence, the USD/MXN dropped for two consecutive days, and it’s on its way toward the 18.00 psychological level, as it has decisively broken the $18.50 mark.
The USD/MXN’s next support would be August 7, 2018, daily low at 18.4047. Breach of the latter and the next support would be the psychological $18.00 barrier. Once cleared, the USD/MXN would dip to April 17, 2018, swing low at 17.9388, which would be up for grabs.
Contrarily, if the USD/MXN reconquers $18.50, that could open the door for recovery. Therefore, the USD/MXN first resistance would be the 20-day EMA At 18.7312, followed by the confluence of the February 9 daily high and the 50-day EMA around 18.9922. Once cleared, the next stop will be the 100-day EMA at 19.2869.
USD/MXN Daily chart
