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USD/MXN Price Update:
- Continues to challenge critical resistance as US-China uncertainty lingers.
- Chances for the bears to takeover once again and dominate.
USD/MXN Price: Continues to challenge critical resistance
Uncertainty continues to grasp the markets, amid mixed information regarding trade negotiations between China and the United States. This has generated a feeling of risk aversion in the markets, while investors are not feeling optimistic about how the talks are going between both parties.
US President, Donald Trump, has said on his Twitter account that China wants to reach an agreement more than Washington. Therefore, this issue continues to dominate the price action in the Latin American markets and currencies, and the USD/MXN yield is closely watched to find future directions in the short term.
Earlier today, the dollar in Mexico was trading at 19.36 in a month that still shows green numbers, with a key resistance now taking the spotlight.
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Key levels to watch on the upside
In the scenario that the pair breaks said zone, located at 19.52, it could then point towards 19.70. Something that is very likely to happen, given the context of the 4-hour chart.
Additionally, it has been rising since the October lows. Once that area is cleared, the price will strengthen the bullish bias towards the level of 19.82. Thus coinciding with the 100% Fibonacci retracement level at 19.86. It is worth mentioning that there is currently a golden cross between the simple moving averages of 50 and 200 periods in the 4-hour chart, favouring the rise.
USD/MXN bearish outlook
On the side of bears, there is a remote possibility that they will reappear on the scene, as the price is showing a slowdown in the bullish bias. If the USD/MXN pair breaks below the 19.32 support, the next target would be set at 19.20, followed by the 19.04 zone.
By breaking this region successfully, the bearish bias would become the dominant one in the medium term. As for the technical oscillators, the RSI is entering negative territory, favouring bears.
On the other hand, momentum is pointing down after reaching new highs, reflecting the deceleration mentioned above. Adding a strong selling pressure to the pair.