On August 19th we argued that the USDMXN has room to rally to the key resistance we have hit the last couple sessions (read here) but now that we are at key resistance, what now?
The USDMXN has a very sloppy cup and handle pattern.
The USDMXN has been trading abnormally heavy the last couple sessions and is now at risk at a break lower out of the long term daily triangle.
Consolidation patterns, like a triangle, can be very explosive patterns when it comes to the markets because the market is “winding up” for so long.
The USDMXN has broken lower out of an ascending wedge, and what makes this potential so good for shorts is the RSI has also been divergent on the last move higher the last few weeks.