From a technical perspective, spot prices currently hover around the confluence comprising of the 200-hour Simple Moving Average and the 61.8% Fibonacci retracement level of the recent modest recovery from the lowest level since December 2015. Some follow-through selling below the overnight swing low, around the 16.80 area, will be seen as a fresh trigger for bearish traders and pave the way for a further near-term depreciating move.
Sustained weakness below the latter will be seen as a fresh trigger for bearish traders and expose the next relevant support near the 16.60 region. The USD/MXN pair could extend the downward trajectory and eventually drop to October/November 2015 lows, around the 16.3555-16.3250 area. On the flip side, the 50% Fibo. level, around the 16.8740-16.8745 region now seems to act as an immediate strong barrier. A sustained strength beyond might trigger a short-covering move towards the 16.9200 zone en route to the 16.9600-16.9700 supply zone. The latter coincides with the 23.6% Fibo. level, which if cleared decisively will negate the negative outlook and lift the USD/MXN back above the 17.00 mark.
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Source: Daily_Forex - 🏆 567. / 51 Read more »