Turkish Lira Struck Again by Erdogan’s Words

  


The USD/TRY is trading below its record highs, but this doesn’t mean that a significant bearish trend is about to emerge.

The USD/TRY was hit by another foray of ‘economic policy bravado’ from Turkish President Recep Erdogan last week which caused the Forex pair to climb to new heights. Even as the USD/TRY continues to press higher, President Erdogan insists that interest rates within Turkey should be lower. Technically, the USD/TRY remains within sight of record highs which came within a hair of 8.75000 on the 1st and 4th of June. As of this writing, the USD/TRY has traded slightly lower and is near the 8.63000 level.

The USD/TRY is a frequently volatile Forex pair offering speculators a chance to pursue trends and fight through rather stark reversals and the occasional spike. However, since the third week in February, when President Erdogan started to become more outspoken about the Turkish lira and Turkey’s central bank policies, the USD/TRY has roiled in an even more violent manner.

Current support near the 8.60000 to 8.56000 junctures should be watched closely by traders. If the value of the USD/TRY does not challenge these ratios significantly, it could signal that another dose of bullish behavior is in store. This is not what President Erdogan wants to hear, but many people in Turkey are not going to challenge Erdogan’s opinion in an outspoken manner. However, what critics of the current Turkish economic policy can do is to buy the USD/TRY on the notion that things will get worse before they will get better regarding the health of the Turkish lira.

Traders should consider being buyers on small downturns which come within sight of current support levels. Cautious speculators may want to see stronger downside action, and the ratios of 8.50000 to 8.48000 touched in order to activate a limit buying order, but this tactic may need a durable amount of patience.

Aggressive traders who believe that technical and behavioral sentiment perceptions are merging together may be proven correct in the near term. Wagering on positions via limit orders that buy the USD/TRY near its current values around the 8.62000 vicinity could prove a solid decision while aiming for resistance as take-profit targets. Speculators should certainly expect more volatility from the USD/TRY in the days to come, and it will not be surprising to see President Erdogan make his sentiment heard again, and if he does speak, it could spook the Turkish lira more.

Turkish Lira Short-Term Outlook:

Current Resistance: 8.70700

Current Support: 8.56900

High Target: 8.76000

Low Target: 8.48000

USD/TRY



Read more here