USD/MXN Price Analysis: Peso bulls eye fresh high since May 2016 ahead of Mexican Inflation

• USD/MXN stays pressured for the fourth consecutive day at multi-day low.
• Bearish MACD signals favor clear downside break of three-week-old horizontal support to keep sellers hopeful.
• Three-month-old descending support line can prod Mexican Peso buyers amid adverse RSI conditions.

USD/MXN takes offers to refresh the intraday low near 17.34 during the early hours of Thursday’s European session. In doing so, the Mexican Peso (MXN) pair fades late Wednesday’s corrective bounce off the lowest levels since May 2016 while printing a four-day losing streak.

It’s worth noting that the Bank of Mexico is up for releasing the 12-month Inflation, Core Inflation and Headline Inflation for May, which in turn can prod the USD/MXN bears on matching downbeat forecasts.

That said, the pair sellers take clues from Tuesday’s downside break of three-week-old horizontal support, now resistance around 17.42. Also motivating the USD/MXN sellers are the bearish MACD signals.

However, a downward-sloping support line from early March, near 17.25 by the press time, challenges the pair bears amid the oversold RSI (14) line.

Hence, the Mexican Peso buyers can keep the reins but their dominance appear to have limited reach, till 17.25.

Should the quote break the 17.25 support, the May 2016 low of near 17.05 and the 17.00 psychological magnet will lure the USD/MXN bears.

Meanwhile, recovery moves need to cross the previous support line stretched from mid-May, close to 17.42, to convince intraday buyers.

Even so, a convergence of the 10-DMA and a fortnight-long falling trend line, close to 17.52 at the latest, appears a tough nut to crack for the Mexican Peso sellers to retake control.

USD/MXN: Daily chart

Trend: Limited downside expected