USDTRY Seesaws Around the 100-Day MA

USDTRY gives up 0.08%  at 5.7084 after Turkey’s Producer Price Index (month over month) came in at 0.17% in October from previous 0.13% the yearly reading for the Consumer Price Index came in at 8.55%, below forecasts of 9.6% in October. Turkish Exports climbed from previous $14.44B to $15.66B in October supported by weaker Turkish lira.

The central bank of Turkey (CBRT) cut the benchmark interest by 250 basis points, above the analyst’s expectations, to 14% in October 24th. As the Turkish army operations in the borders with Syria continues the risks for lira and Turkish trade balance increases to the downside. If tensions between Turkey and US keep escalating, the central bank might have to consider further rate hikes to stop the fall of Turkish lira.

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USDTRY Technical Levels to Watch

On the technical side, USDTRY short term outlook is neutral now after the recent correction from three-month highs, as the pair trades below the 100-day moving average and above the 200-day moving average.  The bull run from 5.45 August 8th lows stopped mid-October at 5.94. USDTRY accelerated the upward move after the price pierced the descending trendline from May 23rd. On the downside first support stands at 5.6994 today’s low, while more pressure will emerge at 5.6746 the 200-day moving average.

Looking north, first resistance for the pair stands at 5.7351 today’s top while a break above might drive prices for a test of the next support at 5.7586 the 50-day moving average. The technical outlook is neutral now for USDTRY; patient traders may wait for a break of the 200-day moving average to enter a short position or a break above the 100-day moving average to initiate a long position.Download our latest quarterly market outlook for our longer-term trade ideas.

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