USD/MXN bounces from recent lows – Société Générale

USD/MXN has rebounded after touching 18.20, but the pair faces resistance at the 50-DMA and descending trend line near 18.40, leaving upside momentum uncertain, Société Générale's FX analysts note.

Daily MACD shows positive divergence

"USD/MXN has experienced a bounce after briefly breaching the lower limit of recent consolidation at 18.20. While the daily MACD continues to show positive divergence, clear signals of a large bounce are yet to emerge. A series of higher peaks and troughs is still lacking in price action on the daily timeframe chart."

"The 50-DMA near 18.40, which is also the descending trend line drawn since April is first resistance. Inability to establish beyond this hurdle may denote risk of extension in decline."