USD/TRY Price Analysis: Greenback bulls are firmer on bullish pennant formation, 18.00 eyed
- Advancing 50- and 200-EMAs are hinting at more upside.
- A Bullish Pennant formation is strengthening the greenback bulls.
- The RSI (14) is displaying some signs of exhaustion as it has slipped below 60.00.
The USD/TRY pair is displaying topsy-turvy moves in a range of 17.22-17.37 for the past three trading sessions. Earlier, the greenback bulls have displayed a juggernaut rally from June 5 low at 15.96 to June 9 high at 17.50.
On a four-hour scale, the asset is forming a Bullish Pennant that signals a volatility contraction phase after a vertical upside move. The consolidation phase denotes inventory purchase by the initiative buyers, which prefer to enter an auction after the establishment of a bullish bias.
Advancing 50- and 200-period Exponential Moving Averages (EMAs) at 17.29 and 16.59 respectively add to the upside filters.
However, the Relative Strength Index (RSI) (14) has slipped below 60.00 after sensing exhaustion in the upside momentum. Although this doesn’t indicate a bearish reversal, for a resumption of an uptrend the RSI (14) needs to surpass 60.00 again.
An upside break of the above-mentioned chart pattern at 17.50, which is the June 9 high will activate the greenback bulls and will drive the asset towards the psychological resistance at 18.00, followed by the 21 December 2021 high at 18.26.
On the flip side, the Turkiye lira bulls will regain strength if the asset drops below June 9 low at 16.75, which will drag the asset towards May 26 high at 16.47. A breach of the latter will unleash the Turkiye lira bulls to more downside towards the psychological support at 16.00.
USD/TRY four-hour chart
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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
