USD/TRY: Bulls flirt with 8.0000 threshold near two-week top, US GDP in focus

  • USD/TRY consolidate gains from 8.0507 after three-day winning streak.
  • Turkish Manufacturing Confidence eased, Capacity Utilization improved in November.
  • Turkey-Germany tussle, bombings in border near Syria and virus woes offer background music while hope of US stimulus favor the bulls.
  • US GDP, risk catalysts become the key for short-term direction.

USD/TRY wobbles around 8.0000 during the early Asian session on Wednesday. In doing so the pair halts a three-day uptrend while keeping pullback moves from the highest since November 11.

Although risk-on mood favors the USD/TRY buyers, notable run-up by Wall Street benchmarks triggers the cautious move off-late.

Even so, the tussle between Germany and Turkey, over the EU military mission in the Mediterranean, joins the news of the bombing in the North Syrian area that shares borders with Ankara to favor the bulls. Additionally, the Daily Sabah marks the doubling of the daily coronavirus (COVID-19) infection figures in Turkey, compared with the previous week, while stating 460,916 total cases and 12,672 death toll by Tuesday.

Furthermore, hopes of US stimulus also gets strong as US President-elect Joe Biden now has the right to receive the President’s Daily Brief, the collection of classified intelligence reports prepared for the national leader. Also propelling the upbeat expectations could be chatters surrounding Janet Yellen’s role as US Treasury Secretary and increasing odds that the vaccine will be out sooner than later.

Amid these plays, S&P 500 Futures flirt with a two-week top after its Wall Street counterpart marked record daily closing on Tuesday.

Although Turkey has no major data/events scheduled for published the preliminary readings of the US third quarter (Q3) GDP will be interesting to watch for the USD/TRY traders. However, risk news shouldn’t be ignored in the meantime.

Read: US GDP Preview: Good reasons for an upside surprise, but not necessarily a dollar surge

Technical analysis

21-day SMA near 8.0330 probes the USD/TRY bulls cheering an upside break of 50-day SMA, currently around 7.9100.

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