Signals for the Lira Against the Dollar Today
- Risk 0.50%.
Bullish Entry Points:
- Open a buy order at 32.25.
- Set a stop-loss order below 31.10.
- Move the stop-loss to the entry point and follow the profit with a price movement of 50 pips.
- Close half the contracts at a profit of 70 pips and leave the rest until the strong resistance levels at 32.50.
Bearish Entry Points:
- Place a sell order at 32.77.
- Set a stop-loss order at or above 32.98.
- Move the stop loss to the entry point and follow the profit with a price movement of 50 pips.
- Close half the contracts at a profit of 70 pips and leave the rest until the support levels at 31.95.
Turkish lira Analysis:
Trading of the US dollar against the Turkish lira has stabilized for the third consecutive week. The lira continues to receive support from the tightening of monetary and fiscal policy in Turkey. Last week, the Turkish Central Bank kept the interest rate unchanged at 50%. However, this tightening policy has not significantly curbed inflation yet. Recently, data released at the end of last week showed inflation rising to around 70% in April. Nevertheless, forecasts suggest that inflation may peak by the end of the first half of this year. It's known that the impact of monetary policy changes may take relatively longer after implementation. Ultimately, estimates indicate a decline in inflation during the second half of the year, reaching around 36% by the end of 2024.
On the political front, Turkey's decision to halt trade with Israel due to Israel's failure to assist Palestinians in Gaza and ensure a permanent ceasefire with Hamas continues to reverberate. Turkish Trade Minister Omar Bolat stated that exports from Israel in 54 product categories would cease until Israel demonstrates a more committed stance toward curbing attacks on Palestinian territories. Furthermore, President Rajab Tayyip Erdogan emphasized that the trade ban aims to pressure Israel to reach a ceasefire in Gaza and allow sufficient aid to enter the region. Also, Erdogan acknowledged a potential harsh Western reaction regarding the trade restrictions imposed on Israel. Concurrently, Israeli news sources reported that the trade halt would affect Israeli consumers in the coming days, particularly impacting prices of basic goods, food items, and industries such as construction and automobiles. Despite criticism from Israeli Foreign Minister Yisrael Katz, Erdogan affirmed that the decision was made to push Israel towards a ceasefire agreement in Gaza.
USD/TRY Technical Analysis and Expectations Today:
Technically, the USD/TRY pair stabilized with slight declines at the beginning of this week, as the pair maintained its limited movement around the upward trend line on the daily timeframe, as shown in the chart. The pair is trading below resistance levels concentrated at 32.87 and 32.50, respectively. On the other hand, the nearest support levels are 32.25 and 32.13, respectively. Currently, the price is moving above the 50 and 200 moving averages on the daily timeframe, while oscillating between these same averages on the four-hour timeframe, indicating the divergence the pair is experiencing in the medium term, contrary to the upward trend dominating the pair in the long term. Price forecasts for the Turkish lira include divergence of the pair if it remains between the indicated support and resistance levels.
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