Daily FX Strategy: USD/MXN - Resistance at 12.3585 to cap recovery

Writtern by: www.imperialFXonline.com

- Resumption of downtrend targets fibonacci retracement level at 12.0450 ahead of 12.0000
- Only a sustained breach of 12.3585-12.4280 risks correction towards 12.6946

The breach of this month's low at 12.1425 has called for a resumption of medium-term downtrend from 15.5844 which commenced in March 2009 and outlook is bearish for further losses towards fibonacci retracement and projection confluence at 12.0450-12.0700 ahead of psychological level at 12.0000, however, sharp fall below latter level is not likely due to exhaustion on the daily and weekly oscillators and risk has increased for a moderate corrective bounce later.

We are looking to sell again as only a move back above the region of 12.3585-12.4280 would indicate a minor low formation and risk a stronger upward retracement towards 12.6946.

Writtern by: www.imperialFXonline.com