The USDTRY pair is trading higher today after new analyses by economists predict that the Turkish economy is in danger of heading for a recession. This dire prediction has extended the slump of the Turkish Lira and is sending the USDTRY on its way to retest the 2nd highest levels it has every reached; a feat attained in August 2018.
The latest price move comes as economists are predicting that Turkey may be close to another possible recession, as the coronavirus outbreak has severely damaged tourism, exports and domestic demand. This outlook, coupled with President Erdogan’s recent comments about the need to take measures to boost the economy (a euphemism for more rate cuts), are weighing on the Turkish Lira this Friday.
The pair is also benefitting from broad-based USD strengthening just ahead of Friday’s critical jobs report.
The USDTRY is presently trading at 6.70191 and looks set to test the resistance seen at the 6.79475 price level, which is where the USDTRY made its 2nd highest ever peak on 27 August 2018. A break above this price level would allow the pair to set its sights on a retest of the all-time highs of 7.08515, seen on 13 August 2018.
However, failure to break the 6.79475 price level could provide a profit-taking opportunity for bulls on this pair, which would prompt a pullback that retests the 6.52786 support. Further support can be seen at 6.24258, and if the price withdrawal move is strong enough to breakdown this area, the upper border of the resolved symmetrical triangle may serve as a reinforcement to the lows of 26 August 2019 and 3 March 2020, located at the 5.97902 support area