USD/TRY extends recovery above 8.00 amid calls of US-Turkey tension

USD/TRY marks a slow grind to the north of 8.00, currently around 8.18, during the early Wednesday. The pair has been in recovery mode following its slump to the late-October lows on Monday.

With Donald Trump’s hesitant departure from the White House awaiting the official announcement, Turkish President Tayyip Erdogan congratulated the US President-elect Joe Biden and the winner of the Vice President's status, namely Kamala Harris. In doing so, the Turkish leader marked a diplomatic play, as per Reuters, to avoid placate tension among the North Atlantic Treaty Organization (NATO) allies that used to have strained relations during the Democratic-era.

The Turkish lira (TRY) also responded to the recent changes in the central bank leader and Finance ministry. After the latest change, former Deputy Prime Minister Lütfi Elvan becomes the new treasury and finance minister whereas Naci Agbal holds the chair as the central bank governor.

Furthermore, recently positive comments from Biden, suggesting a boost to the healthcare and happy days for America, could have joined the vaccine hopes to favor the USD/TRY buyers. That said, S&P 500 Futures print mild losses while stocks in Asia-Pacific gain over 1.0% by press time.

Considering the Veterans Day holiday in the US, Turkey’s Current Account Balance for September, expected $-2.7B versus $-4.63B prior, becomes the only data/event to watch for fresh impulse. Though, risk catalysts can keep directing the pair traders.

Technical analysis

A successful break of 21-day EMA, at 8.15 now, enables the bulls to keep 8.40 and the monthly top near 8.60 on the radars.