The euphoria from the trade agreeement fades
The USDMXN moved lower (MXN higher) on the news of a NAFTA deal yesterday, but the low (high for the MXN) stalled ahead of a target lower trend line.
The price rebound stalled initially today at the 100 hour MA (blue line) and rotated down to the low from last week at 18.70288. Holding there, has given the buyers the go-ahead to move higher and the price has since breached the 100 hour MA at 18.8331 (blue line) and the 200 hour MA (green line) at 18.89507. Each is bullish.
The high - like at the low yesterday - has stalled ahead of a trend line. This one is a topside trend line at 18.9800. Also ahead on the topside is the 50% retracement of the move down from the August 13 high. The 200 day MA is at 19.01363.
The pair will likely continue to be volatile but the techincals will help to tell the story.
For now the 200 hour MA below 18.89509 is support. Stay above is more bullish. Move below is more bearish.
On the topside the trend line at 18.9800 up to the key 200 day MA at 19.01363 is resistance.
Look for the price action to help tell the bullish or bearish story and for traders to use those levels to lean against to define and limit risk in the volatile pair.
