USD/MXN Price Analysis: Mexican Peso retreats from eight-year high but stays bullish below 17.00

• USD/MXN bounces off the lowest level since December 2015, pares the biggest daily loss in two months.
• RSI conditions favor corrective bounce off fortnight-old horizontal support.
• Mexican Peso bears remain off the table below 21-DMA, three-week-old resistance line guards immediate recovery.

USD/MXN picks up bids to consolidate the biggest daily loss in two months around 16.72, up 0.17% intraday, amid early Monday. In doing so, the Mexican Peso (MXN) pair recovers from its lowest level since December 2015.

That said, the below 50 levels of the RSI (14) line supports the USD/MXN pair’s corrective bounce off the two-week-old horizontal line, around 16.70. However, the impending bear cross on the MACD challenges the buyers.

It’s worth noting that a downward-sloping resistance line from July 07, close to 16.83 by the press time, restricts the immediate recovery of the USD/MXN pair.

Following that, the 21-DMA level of around 16.90 becomes crucial for the USD/MXN bulls to cross to retake control.

Also acting as an upside filter is the previous support line stretched from mid-June, close to 16.97 at the latest, quickly followed by the 17.00 round figure.

Meanwhile, a daily closing beneath the previously stated horizontal support near 16.70 can direct the USD/MXN bears toward a downward-sloping support line from mid-May, around 16.55 by the press time.

In a case where the USD/MXN remains bearish past 16.55, the October 2015 low of near 16.32 will be in the spotlight.

USD/MXN: Daily chart

Trend: Limited recovery expected