USD/MXN Price Analysis: Mexican Peso sellers have limited room ahead of US NFP, focus on 17.42
- USD/MXN struggles to defend recent gains at two-month high, prods four-day uptrend ahead of US NFP.
- Overbought RSI, multiple levels since June test Mexican Peso sellers.
- Pullback needs validation from previous resistance line, 200-SMA and US employment report.
USD/MXN prints mild losses around 17.33 as it reverses from the highest level in two months while consolidating the biggest daily gains since March amid early Friday in Asia. In doing so, the Mexican Peso (MXN) pair portrays the market’s cautious mood ahead of the top-tier US employment data.
Apart from the pre-NFP consolidation, overbought RSI (14) and a horizontal area comprising multiple levels marked since early June, around 17.39–43, also challenge the Mexican Peso sellers.
It’s worth noting, however, that the bullish MACD signals and the pair’s sustained trading beyond the previously key technical resistances, now supports, keep the USD/MXN buyers hopeful.
Among them, the resistance-turned-support line from May 23 and the 200-SMA, respectively near 17.04 and 16.98, gain major attention.
Following that, a one-week-old rising support line near 16.98 will act as the final defense of the USD/MXN buyers.
On the contrary, a daily closing beyond the 17.43 resistance will need validation from the 61.8% Fibonacci retracement of May–July downbeat, near 17.47, quickly followed by the 17.50 round figure, to convince the USD/MXN buyers.
In a case where the Mexican Peso bears keep the reins past 17.50, the odds of witnessing a move towards late May swing low near the 18.00 psychological magnet can’t be ruled out.
USD/MXN: Four-hour chart
Trend: Pullback expected