The recovery in the Peso stalled at 17.00. Economists at Société Générale analyze USD/MXN outlook.
Risk of a deeper downtrend only if July low at 16.60 gets violated
USD/MXN has so far carved out a higher trough near 17.00 as compared to the one in July near 16.60. It has gradually established above the 50-DMA denoting receding downward momentum. This is also highlighted by daily MACD which has crossed above equilibrium line.
Defence of 17.00 could result in a short-term bounce towards 17.42 and recent pivot high at 17.64/17.70 which is also a multi-month descending trend line. This is a crucial resistance.
Only if July low at 16.60 gets violated would there be risk of a deeper downtrend.
Source: https://www.fxstreet.com/news/usd-mxn-defence-of-1700-can-spur-rebound-socgen-202309261315