USD/TRY weaker, tests the 200-day SMA near 5.46

  • The pair fades Friday’s move to 2019 highs beyond 5.80.
  • The 200-day SMA holds the downside so far.
  • All eyes on the municipal elections on Sunday.

After climbing to levels last seen in late October 2018 near 5.85 on Friday, USD/TRY has sparked a correction lower to the current area of weekly lows in the 5.50 region.

USD/TRY focused on local elections

TRY was hit by a wave of selling pressure on Friday in response to a sharp move in FX reserves and after news that FX deposits rose to a record high during the week ended on March 15, all exacerbated by a short-lived panic attack in the EM FX space. The CBRT, however, reacted quickly and suspended the 1-Week Repo Rate auctions, preventing the temporary crisis to escalate further.

This week is seeing some recovery in TRY, dragging spot to as low as the 5.46 region, where sits the critical 200-day SMA, after market chatter was pointing to domestic banks putting through large selling orders of foreign currency.

In the meantime, further bouts of volatility are expected to come and go, as the municipal elections get closer (Sunday).

What to look for around TRY

The Lira is expected to remain under pressure in the near to medium terms despite the sentiment in the risk-associated space and around the EM FX universe has somewhat improved in past weeks. The next key event in Turkey will be the municipal elections (Sunday), considered crucial as the much-need structural reforms are expected to kick in soon afterwards. Furthermore, TRY will remain in the centre of the debate ahead of the elections, as unwelcomed weakness in the currency could prompt an emergency rate hike by the CBRT. This scenario will surely collide with Erdogan’s intentions of lower rates and undermine at the same time the efforts of the economy to recover from the current recession.

USD/TRY key levels

At the moment the pair is losing 0.54% at 5.5152 at faces the next support at 5.4630 (200-day SMA) seconded by 5.4066 (low Mar.20) and then 5.3533 (55-day SMA). On the other hand, a break above 5.6371 (high Jan.3) would expose 5.8413 (2019 high Mar.22) and finally 5.8707 (high Oct.23 2018).

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD steady around 1.1240 in ultra-thin holiday's trading

The EUR/USD pair bounced some 20 pips from its weekly low during the Asian session, now mute around 1.1240 with most market's off today. Softer-than-expected US housing data passed unnoticed.


GBP/USD battling around 1.3000

The GBP/USD pair is heading nowhere fast after bottoming for the week at 1.2978, amid lack of progress in Brexit negotiations.  Encouraging UK data failed to trigger Pound's demand.


USD/JPY: On track to close in the middle of its 50-pip weekly range below 112

The USD/JPY pair remains frozen below the 112 handle in the NA session and there is no reason for it to make a meaningful move as investors are already enjoying the Easter holiday.


The Tale of the Prosperous Consumer-US Retail Sales

American consumers asserted the right to spend in a grand fashion in March boosting retail sales to the fastest expansion in 18 months as the booming job market put the shutdown marked holiday season to rest.

Read more

Gold Forecast: Eyes 8-month rising trendline after weakest weekly close since December

The troy ounce of the precious metal lost around $17 this week and now looks to record its lowest weekly close since the end of December near $1275.

Gold News