USD/MXN Price Forecast: Peso rally targets April 2024 low

The Mexican Peso demonstrated notable strength against the US Dollar, driving the USD/MXN pair down toward two-year highs for the currency near 16.85. The currency pair shrugged off a strong US Nonfarm Payrolls report as market participants continued to favor the Peso, leaving USD/MXN trading near 16.88 and positioned to challenge its April 2024 low of 16.74. From a technical perspective, the downward trajectory is expected to persist as the Relative Strength Index (RSI) descends deeper into bearish territory. Should selling pressure continue, the initial support zone sits at the key psychological milestone of 16.50, followed by the May 2024 monthly low of 16.52, and the 2024 yearly low at 16.26. A clear breach beneath these levels could expose the critical 16.00 figure. Conversely, a bullish reversal requires buyers to reclaim the 17.00 threshold, which would clear the path toward the August 19 high at 17.07. Extended recovery attempts will face successive hurdles at the 50-day Simple Moving Average (SMA) at 17.25, the 100-day SMA at 17.30, and the 200-day SMA at 17.48.