The USD/MXN has sustained its value below the 20.00000 level and has continued to incrementally lower resistance levels. Holiday trading volumes were not large, but the ability of the USD/MXN to maintain a steady bearish trend and continue to prove that support levels were vulnerable will not go unnoticed. Speculators should be careful not to get too over-confident, but the momentum of the USD/MXN has been steadily downward even as many financial institutions sat on the sidelines the past week-and-a-half.
The 20.00000 value for the USD/MXN remains an important psychological level. The mark is now acting as an important higher resistance level which was tested and proved durable last week. As trading in 2021 begins, speculators may be looking at long-term charts and seeing that the USD/MXN is beginning to traverse within values it has not fully traded since early March of 2020.
The support junctures of 19.80000 to 19.70000 will now be considered a critical inflection point by speculators. The ability of the USD/MXN to sustain values below the 19.90000 will be looked at as significant, and five-day trading charts show that support levels have been targeted and proven weak. After hitting the 19.81000 mark late last week, the USD/MXN did experience a solid reversal higher, but the thrust upwards eventually failed to build momentum. Early trading this morning has seen more bearish price action within the Forex pair, and resistance levels appear to have incrementally lowered.
Speculators need to consider the potential of higher trading volumes in Forex near term and the effect it could have on the USD/MXN. Traders should not blindly pursue selling positions of the Forex pair; they need to use their risk management wisely. However, bearish sentiment within the USD/MXN is displaying the potential for more downward price action, which looks attractive.
The USD/MXN has seen a strong move downwards, and the ability of the Forex pair to maintain its trend during the holiday season should not go unnoticed. As the week begins and financial institutions return to the marketplace, speculators may suspect that additional bearish moves will continue to potentially challenge long-term support levels and create lower values for the USD/MXN.
Mexican Peso Short-Term Outlook:
- Current Resistance: 19.89000
- Current Support: 19.77000
- High Target: 19.94000
- Low Target: 19.70000
