USD/MXN Price Analysis: Rally finds resistance at 20.20, Mexican peso at lowest in three weeks

• USD/MXN break above 20.00 and soars to 20.20.
• Mexican peso remains under pressure in the short term.
• The technical outlook now favors the upside in USD/MXN. 

Risk aversion and a rally of the US dollar ahead of the FOMC meeting on Wednesday boosted the USD/MXN. The breakout above 20.00 added more fuel to the rally. The Mexican peso is among the worst performers on Monday.

The cross reached at 20.20 the highest level since late August. The 20.20/25 band now is the key resistance and a break higher should clear the way to more gains, targeting the August top at 20.45. Price is back above the 20, 100 and 200-day simple moving average. The road north has many resistance levels unit 20.65.

Technical indicators now point to the upside in USD/MXN after the price broke a multi-day range. A slide back under 20.00 would negate the bullish short-term outlook. Below support levels might be seen at 19.97 and then the September low around 19.85.

USD/MXN daily chart