• USD/MXN declined on Wednesday as peso strengthened amid optimism over potential shifts in U.S. trade policies and Mexico's strong economic fundamentals.
•Investors are focused on how the Trump administration will fulfill its campaign promises
•The Mexican peso was up 0.67% against the dollar after falling on Tuesday, following Trump's comments about potential steep tariffs on Mexico and Canada starting Feb. 1.
• Mexican peso has lost over 20% of its value last year, recording its biggest annual loss against the greenback in 16 years.
• Immediate resistance is located at 20.629(38.2%fib), any close above will push the pair towards 20.855(23.6%fib).
• Support is seen at 20.443 (50%fib) and break below could take the pair towards 20.257(61.8%fib).
Recommendation: Good to buy around 20.440, with stop loss of 20.240 and target price of 20.700
