USD/TRY Outlook: Lira remains under strong pressure and may fall significantly if situation deteriorates
USD/TRY
The pair hits new 1 1/2 month high at 5.9220 on Monday, in extension of last week's 3% advance and eyes pivotal barrier at 5.9408 (Fibo 61.8% of 6.2445/5.4494, May/Aug fall).
Turkish lira lost ground after recent strength was capped by 200DMA and came under strong pressure on Turkey's military action in Syrian and subsequent threats of strong sanctions from the US, which could be devastating for Turkish economy, already in recession.
Daily techs maintain strong bullish momentum, with action being underpinned by multiple bull-crosses of daily MA's in full bullish setup. Lira could fall significantly and extend weakness through psychological 6.00 barrier, if the US imposes sanctions on Turkey.
Overbought daily stochastic warns pause in current rally, however, pair's sentiment remains strong and suggests shallow dips that would keep intact a higher base at 5.8150 zone, before bulls resume.
Res: 5.9220; 5.9408; 6.0000; 6.0569
Sup: 5.9000; 5.8902; 5.8666; 5.8548
Author
Slobodan Drvenica
Windsor Brokers
Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.
