Short-term consolidation follows bearish momentum
USD / MXN crosses a fairly consolidated range early in the day; this happened after the Forex pair reconfirmed its bearish momentum at the end of last week.
The USD / MXN is once again in its shallower depths as it tests waters that have been periodically crossed over the past seven months. The 19.80000 junction continues to act as a key inflection area for the USD / MXN. Since the end of November 2020, this environment has proven to be a magnet for bearish activity, but it has also produced some higher reversals.
As of this writing, USD / MXN is trading near the 19.84000 level. The Forex pair started trading yesterday near the 19.96000 junction and was able to stay below the psychologically important 20.0000 level.
The ability to hold its price below the 20.0000 junction and gradually decline yesterday should be carefully considered by technical traders.. A low of around 19.74000 was hit on Monday before the USD / MXN rallied slightly. This upward reversal by touching the support junction of 19.74000 is something that has happened on a regular basis when the value has been challenged.
Traders may become skeptical of the ability of the USD / MXN to effectively penetrate and hold values below 19,80000. Until the Forex pair is able to prove that this support level is vulnerable and see the USD / MXN trading below that mark for a substantial amount of time, traders should not aim for too low targets. . Traders may believe that the USD / MXN downtrend remains intact, but the price movement since mid-April has always produced a range between the ratios of 19.80,000 to 20.21,000, with occasional outliers. .
Speculators cannot be blamed for thinking that if and when the 19.75000 to 19.70000 junctions are dug lower, a sea of volatility could ensue. Because of this notion, traders should be vigilant about their use of stop-loss and take-profit tactics and try not to be greedy because of the tendency to turn things around.
Conservative traders who continue to be drawn to the bearish momentum in USD / MXN should be patient and wait for slight upside reversals, then activate their short positions with limit orders.. If the USD / MXN continues to show its ability to hold its current price below the resistance levels of 19.86000-19.88000, this could be an indicator that further bearish momentum may be showing in the near term. . USD / MXN traders should look for quick trades on the Forex pair.
Short-term outlook for the Mexican peso:
Current Resistance: 19.87200
Current support: 19.80000
High target: 19.89,000
Low target: 19.73500