USD/MXN Price Analysis: Bullish bias intact, looking at a critical downtrend line

• Mexican peso under pressure on Wednesday, ends recovery.
• USD/MXN remains above 20.20, likely to test 20.40

After falling for two consecutive days, USD/MXN resumed the upside and climbed to 20.35, approaching Tuesday’s peak. The cross found support at 20.20, reaffirming the bullish short-term outlook.

The immediate support stands at 20.20, followed by 20.00/05 (20 and 55-day moving averages / horizontal level). A decline under 20.00 would alleviate the bullish pressure. At 19.85, an uptrend line is a dynamic support.

Technical indicators point to more gains and are approaching extreme overbought levels, but not there yet. The next resistance is seen at 20.40. A daily close above would clear the way for a test of the 20.55 critical area, where a horizontal resistance meets with a downtrend line. If reached, a correction seems likely, probably targeting 20.40. A break higher would strengthen the bullish bias.

USD/MXN daily chart