The USD/MXN exchange rate has bounced back after briefly falling to 18.20. However, it is now facing resistance at the 50-day moving average (50-DMA) and a descending trend line around 18.40. Analysts point out that the daily MACD shows some positive divergence, but there’s no strong signal for a significant price bounce since there haven’t been higher peaks or troughs. The 50-DMA and the descending trend line from April are the first points of resistance. If USD/MXN fails to break through this level, it could signal further declines.

Related Market News

In related news, AUD/USD is gaining ground thanks to the RBA’s hawkish stance and expectations for a Fed rate cut. USD/CHF remains above 0.8050 ahead of monetary policy decisions, while gold holds steady above $4,200 amid expectations of a Fed rate cut. The upcoming JOLTS Job Openings report is expected to give insight into the labor market as the Fed’s decision approaches. It anticipates 7.2 million job openings in October, which could provide new signals for the job market. Chainlink (LINK) is staying steady around $13.70, bolstered by positive ecosystem activity and decreasing exchange reserves. As of December 9th, 2025, the USD/MXN pair finds itself at a crucial point after bouncing from 18.20. The main challenge for the US dollar is the resistance around 18.40, which coincides with the descending trend line and the 50-DMA. If it cannot break above this level soon, the peso may regain strength. Market focus is predominantly on the Federal Reserve, with fed funds futures indicating a 92% chance of a 25-basis-point rate cut this week. This expectation is limiting any major strength in the US dollar. The recent JOLTS report supported this outlook, revealing a further drop to 7.0 million job openings in October and highlighting a cooling labor market.

Opportunity In Derivatives

From a derivatives perspective, there is an opportunity due to elevated implied volatility ahead of the Fed’s decision. The pair is stuck between support at 18.20 and resistance at 18.40, allowing traders to consider options strategies that could profit from a breakout. A rise above 18.40 would indicate a stronger bounce, while a drop below 18.20 could lead to a swift decline towards the 18.00 psychological level. On the Mexican front, Banxico has kept its policy rate steady, citing that domestic inflation, though falling, remains above the target at 4.4% as of November 2025. This difference in policy has contributed to the peso’s strength this year. However, the modest global slowdown observed in 2025 has put pressure on Banxico to consider easing next year. Reflecting on the past, the peso showed remarkable resilience during the Fed’s aggressive rate hikes in 2022 and 2023, mainly due to Banxico’s proactive measures and high interest rate differentials. Now that the Fed is easing, the key question is if the peso can maintain its attractiveness. The high price of gold, currently above $4,200, indicates significant market anxiety and a shift away from the dollar, which may continue to support the peso. Create your live VT Markets account and start trading now.

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