- USD / TRY loses more momentum and tests 9.2000.
- The position offered in the dollar weighs on the pair.
- The CBRT meets Thursday and is likely to cut rates.
The Turkish lira adds to Tuesday’s earnings and drags the USD/TRY to new 3-day lows near 9.2000 on Wednesday.
USD / TRY focuses on the CBRT decision
The USD / TRY loses ground for the second consecutive session in the middle of the week against the persistent corrective fall of the dollar. In fact, the dollar faded the initial optimism and now the US dollar index (DXY) has fallen back into negative territory.
Meanwhile, the soft tone in the dollar allows the risk complex, and the beleaguered lira, to extend gains for an additional session on Wednesday before Thursday’s CBRT event.
It is worth noting that the consensus among traders remains heavily skewed towards another 100bp interest rate cut, bringing the one-week repurchase rate to 17.00%.
Apart from the CBRT meeting, the Turkish calendar will show the Consumer Confidence for the current month.
Technical levels
So far, the pair is shedding 0.46% at 9.2518 and a drop below 9.1234 (10-day SMA) would target 8.9881 (20-day SMA) and finally 8.8317 (October 4 monthly low). On the other hand, the next rising barrier is lined up at 9.3699 (October 19 all-time high) followed by 10.0000 (round level).
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