Ella 
USD/MXN rose for a sixth straight day and hit a three-month high on Thursday.
A recent break above the 100-day SMA and resistance at 17.40-45 favors bullish traders.
The slightly overbought RSI on the daily chart is the only factor limiting further gains for the pair.
USD/MXN posted strong gains for the sixth straight day on Thursday and jumped to a more than three-month top in early European trading. However, the spot price has retreated a few points in the past hour and is currently trading around the 17.65 area, still up 0.40% on the day.
From a technical point of view, this week’s sustained rise and break above the 100-day SMA for the first time since September 2022 is seen as a new trigger for bullish traders. A subsequent breakout of the strong horizontal barrier of 17.40-17.45 triggered some follow-through technical buying and may have paved the way for further gains in the short term.
The daily RSI is overbought, be cautious and wait for a short-term price consolidation or pullback before placing new bets. However, the pair is expected to build on its strong gains over the past week and is aiming to challenge the all-important 200-day SMA, which is currently around the 18 mark.
The resistance mentioned above coincides with the descending trendline from the September 2022 swing high and should serve as a key pivot point. A decisive break above this level should pave the way for further gains.
On the other hand, any meaningful corrective decline above the day’s lows in the 17.60-17.55 area may be viewed as a buying opportunity and remain limited to the resistance breakout near 17.45-17.40. . This is followed by the 100-day SMA at 17.30-17.25. A break below these support levels could trigger some technical selling and drag USD/Peso back towards the round figure of 17.00.
