As the month of November gets underway, the USD/MXN is trading near short-term highs and is challenging the 20.67000 level. Current values have October’s range from the second week in view, when the Forex pair consistently traded between 20.60000 and 20.80000 with outliers. The USD/MXN has seemingly grasped onto the upper tier of its mid-term price range and is comfortably traversing ratios it also challenged in June of this year.
After hitting highs on the 12th of October near the 20.90000 vicinity, the USD/MXN did suffer a reversal lower and in fact the bottom depth was only hit a few days ago. On the 26th of October, the USD/MXN did traverse the 20.10000 level; it also did this the day before. However, on the 27th, a reversal higher started to develop and, before going into the weekend, the USD/MXN touched the 20.62000 ratio.
Intriguingly within early trading today, the USD/MXN has shown no tendency to reverse lower with any vigor. It can be argued that the nearby short-term support level for the pair is 20.60000 at this time. If current support continues to prove durable this could be an indication the USD/MXN has not finished an upwards trajectory and may begin to flirt with the highs seen in the second week of October.
Some speculators may feel technically the USD/MXN has been overbought, but as the week begins and shadows from the U.S. Federal Reserve lurk in the near future regarding its interest rate policy announcements, caution may prove to be wise. The USD/MXN has the capability of delivering choppy conditions and it has definitely traded within a lower price band for long stretches of time in the recent past, but now may not be the time to look for the short-term trend to reverse swiftly.
Traders who believe the USD/MXN may have some additional room to climb cannot be faulted. If speculators want to be conservative, they may decide to wait for slight pullbacks near support ratios of 20.60000 to 20.55000 to initiate buying positions as they search for rebounds higher. Wagering on upside momentum at this time may feel dangerous because of the heights the USD/MXN is fluttering, but there could be loftier upside to accomplish near term.
Mexican Peso Short-Term Outlook
Current Resistance: 20.74000
Current Support: 20.52000
High Target: 20.41000
Low Target: 20.91000
