USD/MXN: Defence of 16.60 can lead to a short-term bounce – SocGen

Economists at Société Générale analyze USD/MXN technical outlook.

16.60 remains important support

USD/MXN rebound petered out near the trend line drawn since September 2022 at 17.73. It has staged a steady pullback and is now challenging 50-DMA near 17.00. It would be interesting to see if the pair can carve out a higher low as compared to the ones in July/August at 16.60. Defence of this level can lead to a short-term bounce towards 17.42 and the trend line near 17.73. 

Only if the support at 16.60 gets violated would there be risk of a deeper downtrend.