USD/MXN Price Analysis: Mexican Peso recovers from record lows

• The Mexican peso is charting an oversold bounce in Asia. 
• The currency has declined by over 25% so far this month.

Mexican peso (MXN) is showing signs of life in Asia with the American dollar suffering broad-based losses.

The MXN is currently trading at 25.11 per US dollar, having hit a record low of 25.4447 per US dollar during the overnight trade.

The recovery from record lows could be associated with the oversold conditions reported by technical indicators like the relative strength index. Also, the American dollar is being offered in Asia, possibly in response to the US Federal Reserve's decision to launch an open-ended asset purchase program.

While Peso may rise further, gains will likely be reversed if oil prices resume the recent slide. WTI fell from $54 to $20 in the four weeks to March 18 and has been restricted to $20-$28 range ever since.

The immediate outlook would turn bearish only if the spot ends Tuesday below 24.3974 - the low of Monday's bullish marubozu candle.

Daily chart

Trend: Oversold bounce

Technical levels