*OspreyFX would like to state that traders should research extensively before following any information given hereby. Please read our Risk Disclosure for more information.
USD/MXN Price Forecast Talking Points:
- The pair remains steady in an upward trend despite the volatile movements from early December.
- Chances for the bears to take the reins in the next days?
Retraced in mid-week below 19.50
The USD/MXN price remains firm in a general upward trend, although December has been somewhat volatile for the price action. In fact, thanks to the strong resistance found at 19.62, the price of the Dollar in Mexico fell towards the support zone of 19.42. Where it established another point for a trend line drawn from the lows of mid-November.
The bulls have had a challenging job to overcome the barrier, which has made the price action in the pair a bit erratic.
Subscribe to our newsletter to receive our weekly updates + more straight to your inbox!
Bullish outlook for the pair
Once the price breaks the 19.52 level, that area may be put back into focus. This containment zone also protects the next target located at 19.70.
When the bullish force exceeds this level, it’s possible that an upward acceleration will occur in direction to the 19.82 level. Where the highs of October of this year are located.
Upon clearance, the focus will be placed in the critical psychological region of 20.00, thus strengthening the dominance of the bulls in the short and medium-term.
Will the bears dominate in the coming days?
When it comes to the red waters, the USD/MXN pair could look for a break in the uptrend line, which converges with an important support zone. If this yields to the bears, it is possible that the pair will point towards the level of 19.32. Followed by the SMA of 200 periods on the 4-hour chart.
There, it might gain bullish momentum again, since it’s dynamic support of importance for the bulls to think about and take the reins. However, if this indicator is fractured, eyes will be set at the level of 19.20.
When the bears overcome this obstacle, a bearish acceleration is likely to occur in the direction of the October lows, located at approximately 19.04.
As for the technical oscillators, the RSI indicator remains in negative territory, while the momentum is entering the neutral zone, although it is pointing upwards. This indicates that the upward force may accelerate over the coming days.