USD/TRY: TURKISH LIRA SETS NEW ANTI-RECORDS

Current trend

During the Asian session, the USD/TRY pair is actively growing, testing the 31.8255 mark for a breakout, although against ambiguous American macroeconomic statistics, some investors are in no hurry to open trading positions, expecting the emergence of new drivers of movement.

Yesterday, the first of two scheduled speeches by US Fed Chairman Jerome Powell in Congress took place: the official expressed doubts about maintaining the current rate of weakening inflation but retained optimistic assessments of the stability of the American economy, as a result of which analysts did not change their estimates of the chart for the regulator’s transition to a dovish course and They believe that it will begin no earlier than the June meeting. In addition, at the end of the week, the February report from the American labor market will be published: experts suggest that the dynamics of creating new jobs outside the agricultural sector will slow down from 353.0K to 200.0K, and the average hourly wage – from 4.5% up to 4.4%.

The lira remains under pressure from fundamental economic problems amid persistent trade deficits and government decisions aimed at increasing government salaries and utility tariffs. In addition, the tight monetary policy of the Central Bank of the Republic of Turkey, which raised the interest rate from 25.00% to 30.00% at the last meeting, has not yet brought noticeable results. Meanwhile, according to the Turkish Statistics Institute (TÜİK), the country’s gross domestic product (GDP) fell from 5.5% to 4.5% YoY last year, reaching 1.12T dollars at current prices. A significant contribution to it was made by household consumption, which added 8.9 points, and investment, which amounted to 2.0 points. At the same time, net exports and changes in inventories had a negative impact on economic growth, reducing it by 3.1 points and 4.1 points, respectively. Finance Minister Mehmet Simsek reported that national income exceeded 1.1T dollars, and per capita income adjusted by 2.450K dollars to 13.110K dollars.

Support and resistance

On the daily chart, Bollinger Bands are steadily growing: the price range is expanding from above, letting the “bulls” renew record highs. The MACD indicator increases above the signal line, maintaining a strong buy signal. Stochastic shows similar dynamics, being located near the highs, signaling that the instrument may become overbought in the ultra-short term.

Resistance levels: 31.8306, 32.0000, 32.1500, 32.3000.

Support levels: 31.6877, 31.5000, 31.3665, 31.2500.

Trading tips

Long positions may be opened after 31.8306 is broken upward with the target at 32.1500. Stop loss – 31.6877. Implementation time: 2–3 days.

Short positions may be opened after a rebound from 31.8306 and a breakdown of 31.6877 downwards with the target at 31.5000. Stop loss – 31.8306.