Price tumbles toward lows for they year
The Mexican Central Bank surprise rise in rates to 4.25% from 4.0% has sent the MXN higher (the USDMXN lower.
Technically, the move took the price away from its 100 and 200 bar moving averages on the 4 hour chart above. Those levels come in at 20.0697 and 19.9908 respectively (see blue and green lines ). Earlier this week, the price also fell below its 200 day moving average at 20.37578 and 100 day moving average at 20.21506. All those moves were steps in the bearish direction.
The price low just reached 19.7067. That low bottomed between a swing area at 19.6976 to 19.71377. There has been a bounce off that support. The price currently trades at 19.8362.
Going forward, if the sellers are to remain in control, stay below the 200 bar moving average on the four hour chart at 19.9911 (call it 20.000) is now a key risk defining level. Stay below is more bearish.
On the downside, a move back below the low for the day and swing area, would have traders looking toward the low price from June at 19.59539. That it is also near other swing lows going back to January. The low for the year was also in January at 19.5434.
