USD/MXN Price Analysis: Above the 200-day, testing 20.20

• USD/MXN hits 20.20 for the first time in a month.
• Pair moving with a bullish bias, at the 200-day simple moving average.

The deterioration in market sentiment weakened the demand for emerging market currencies, among which is the Mexican peso that lost ground at a slower pace. The USD/MXN peaked at 20.20 on European hours, reaching the highest level in a month. It then pulled back to 20.10.

The pair is approaching the 20.20 area again. A consolidation above would point to additional gains, with the next strong resistance seen at 20.30/35. Technical indicators, favor the upside. The daily RSI is moving north, still far from overbought territory, Momentum is above 100 and price is holding well above the 20 and 55-day moving average. Thursday’s up move pushed the price above the 200-day moving average.

A retreat from the current level should find support around 19.97/20.00. If USD/MXN drops below, the bullish bias would be negated. The next support stands at 19.85. A daily close under 19.80, should point to more gain for the Mexican peso

USD/MXN daily chart