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USD/MXN technical outlook: Mexican Peso soars as USD/MXN tumbles below 19.80

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The USD/MXN uptrend is intact, although the pair edges lower following the approval of the judicial reform. The pair hit a new weekly low of 19.74, though some buyers entered the market after the dip to the latter.

The Relative Strength Index (RSI) is mixed as the indicator is bullish, but the slope suggests that sellers are gathering steam as the RSI aims for the 50-neutral line. Hence, in the short term, the exotic pair is tilted to the downside.

If USD/MXN stays below 20.00, the first support will be 19.50. A breach of the latter will expose the August 23 swing low of 19.02 before giving way to sellers eyeing a test of the 50-day Simple Moving Average (SMA) at 18.85.

Conversely, the USD/MXN must clear the psychological 20.00 figure for a bullish continuation. If surpassed, the next ceiling level would be the YTD high at 20.22. On further strength, the pair could challenge the daily high of September 28, 2022, at 20.57. If those two levels are surrendered, the next stop would be the swing high at 20.82 on August 2, 2022, ahead of 21.00.


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