The USD/TRY has seen a long-term bullish trend produce stronger momentum recently and the forex pair is making quick work of resistance levels with sustained higher trading. The Turkish government faces an export market which is faltering due to the economic effects of coronavirus, but importantly the Turkish government’s leadership continues to deliver more hardline rhetoric instead of solid financial guidance.
Citizens in Turkey are likely eyeing the USD as a safe haven against the TRY and this may be producing a detrimental effect on the USD/TRY exchange rate too domestically. The trajectory of the Turkish Lira has been compromised, and it should be remembered that on the 5th of August the USD/TRY was trading near the 6.85000 level. On the 22nd of October, the USD/TRY was trading near 7.77000 and since then has seen a steady amount of further bullish momentum create a higher and volatile exchange rate. As of this morning, the USD/TRY is near the 8.49000 price vicinity.
As the US elections get underway today, risk appetite globally may diminish over the next couple of days as investors become increasingly cautious. Speculators may want to continue to buy the USD/TRY and look for additional upside action. Because of the volatile nature of forex when US elections are taking place and the history of the USD/TRY, it is advised that traders use limit orders to protect against ugly price fills today and tomorrow.
There are seldom one-way avenues in forex, but until the Turkish government proves it can be transparent regarding its fiscal responsibility, speculators will be tempted to pursue the bullish trend of the USD/TRY. The Turkish Lira is trading at highs against the USD and this trend doesn’t appear ready to end. Traders need to be patient and they must guard against using too much leverage while pursing buying positions of the USD/TRY.
The range of the USD/TRY has proven to be volatile as it has marched higher and broken through resistance easily the past week and a half. The surge of the USD/TRY may not be as aggressive as it has been recently, but it would be strange to wager against the forex pair with a selling position. Speculators should continue to pursue bullish momentum and buy the USD/TRY.
Turkish Lira Short Term Outlook:
Current Resistance: 8.57000
Current Support: 8.35000
High Target: 8.80000
Low Target: 8.26000
