USD/MXN rebounds from three-week lows but fails to recover 24.00

• Mexican peso losses momentum against US dollar on Monday.
• USD/MXN rises from 23.55, lowest since mid-April, tops below 24.00.

The USD/MXN is consolidating daily gains on Monday as it trades at 23.90. Earlier it dropped to test last week lows around 23.55 and then the Mexican currency lost strength.

The US dollar posted mixed results on Monday while the Mexican peso was among the worst performers, after rising sharply on Friday. It was a quiet session across financial markets.

In the US, expectations about negative rates eased following comments from several FOMC members. No economic reports were released in the US. Next on the docket are jobless claims on Thursday and retail sales on Friday. In Mexico, the central bank will have its board meeting on Thursday. A 50bps rate cut is expected.

Technical levels

The rebound from the lows in USD/MXN was capped under 24.00. The pair peaked at 23.98 (also the 20-SMA in four hours chart) and pulled back modestly. The short-term bias still points to the downside. The immediate support now is seen at 23.75/80 before the 23.55 area. On the upside, a rise above 24.00 would alleviate the short-term pressure. The next resistance stands at 24.20.