Signals for the Lira Against the US Dollar Today
- Risk 0.50%.
Bullish Entry Points:
- Open a buy order at 35.15.
- Set a stop-loss order below 34.95.
- 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 35.50.
Bearish Entry Points:
- Place a sell order for 35.50.
- Set a stop-loss order at or above 35.60.
- 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 35.29.
Turkish lira Analysis:
The USD/TRY pair stabilized at the beginning of this week, failing to exceed the peak recorded at the end of 2024 at 35.42 lira. Reports revealed a return of support from Turkish financial and monetary authorities to the lira price, with the pair stabilizing within a narrow range despite the Turkish central bank's interest rate cut in the last meeting of 2024, where the rate was cut by 250 basis points to 47.5%.
In a breakdown of the data, the Turkish Statistical Institute announced in its report released on Friday that Turkey's annual inflation rate had declined to 44.38% in December, compared to 47.09% in the previous month. Education and housing prices saw the highest annual increases of 91.64% and 69.03%, respectively. Meanwhile, the lowest increases were in the transportation and clothing and footwear categories at 25.88% and 32.32%, respectively. On a monthly basis, consumer prices rose by 1.04% in December, driven by a 2.78% increase in the prices of furniture and household appliances.
Following the data, Turkish Treasury and Finance Minister Mehmet Simsek stated that the latest data showed a decline in Turkey's inflation rate in December to its lowest level in about 19 months. Furthermore, Simsek attributed this decline to the success of government policies, which have succeeded in reducing rates by about 20% compared to the average of the last two years. Alos, the Turkish minister confirmed that economic policies support the implementation of an inflation control program.
Currently, expectations of interest rate cuts are expanding this year, following statements by Turkish President Recep Tayyip Erdogan that carried indications in this regard. While inflation data, which declined in December, may support an increase in the pace of these cuts.
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TRYUSD Technical Analysis and Expectations Today:
Technically, the USD/TRY pair stabilized within a narrow trading range, as the pair stabilized below the peak recorded at the end of 2024 at 35.42 lira. Concurrently, the pair is supported by trading above the ascending trend line shown by the chart. Obviously, this is in conjunction with the price trading above the 50-period moving average on the four-hour timeframe. At the same time, the price is trading above the 50 and 200-day moving averages, indicating an overall upward trend dominating the pair's movements. The forecast for the Turkish lira price tends to continue the rise of the dollar against the lira as the pair targets levels of 35.50 and 35.75, respectively.
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