USD/TRY collapses nearly 3% to 3.7500

Pablo Piovano FXStreet

The Turkish Lira is finally seeing some relief today, with the USD/TRY losing almost 3% to the 3.7500 neighbourhood.

USD/TRY lower on politics, dollar

The selling pressure stays unabated around the buck so far this week, particularly intensified after yesterday’s press conference by US president-elect Donald Trump.

Adding to TRY strength, Turkish president Erdogan increased his rhetoric on speculation in the FX markets as a mean to attack the country, adding that the central bank ‘has the necessary tolls and ability to take measures on this’.

It is worth mentioning that the Lira reached an all-time low vs. the greenback on Wednesday at levels above the 3.9400 handle, or nearly 12% lower than the close on January 2, and it had the second worst performance behind the Argentine Peso during the last year.

Geopolitical risks, higher inflation figures and the omnipresent conflict between the government and the central bank appear, however, as the main headwinds facing TRY for the foreseeable future.

USD/TRY key levels

At the moment the pair is losing 2.65% at 3.7621 and a break below 3.7058 (low Jan.10) followed by 3.6370 (low Jan.9) and then 3.5902 (20-day sma). On the upside, the next hurdle lines up at 3.9291 (today’s top) followed by the historical high at 3.9423 (Jan.11).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

EUR/USD faces next resistance near 1.1930

EUR/USD continues to build on its recovery in the latter part of Wednesday’s session, with upside momentum accelerating as the pair retargets the key 1.1900 barrier amid a further loss of traction in the US Dollar. Attention now shifts squarely to the US data docket, with labour market figures and the always influential CPI releases due on Thursday and Friday, respectively.

GBP/USD sticks to the bullish tone near 1.3660

GBP/USD maintains its solid performance on Wednesday, hovering around the 1.3660 zone as the Greenback surrenders its post-NFP bounce. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold holds on to higher ground ahead of the next catalyst

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of modest losses in the US Dollar and despite firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.