USD/TRY in a Rising wedge.Hey, I am back with another Forex idea as I said, that I will deliver a one Forex Idea every working day.
Let's get into chart.
Basically USD/TRY has printed a rising wedge which is considered as bearish pattern and is expecting the price to see a spike down.
RSI has also printed a bear flag, overall this seems like a good trade.
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USDTRY
The Turkish lira eases against the US dollarThe Turkish lira eases against the US dollar in the recent sessions following its persistent attempt to recovery. The USDTRY exchange rate is currently seen gradually moving up today but it’s widely expected to turn bearish once again in the coming sessions as the buck buckles. It was recently reported that Turkey will now continue to back investments in the country that will reduce the number of imports and increase exports. This was according to Turkish Treasury and Finance Minister Berat Albayrak, citing the latest announcement of the Turkish Central Bank to start reallocating its Turkish lira rediscount credits for local firms. According to Albayrak, around 400 million Turkish liras or 59 million US dollars would be given to businesses with a maximum maturity of about 10 years. Meanwhile, the US dollar’s strength continues to deteriorate as the risk sentiment continues to prosper, raising talks about how long its dominance will last.
Remittent 10-Year Journey of Turkish Banks #1 (Akbank)
Akbank, one of the largest banks in Turkey have devalued -86.18% in last 10 years against United States Dollar .
Even though most of the Turkish Banks are listed cheaper than a bottled of water, why foreign-investors still keep liquidating their positions?
There have been many political, economic and geopolitical changes since 2010 in Turkey. Whilst these have been never seemed an issue by Turkish people, liquidation of foreign investment capitals from Turkish Industries proves that we are getting closer to the light at the end of the tunnel.
The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
ridethepig | Thoughts and Themes in TurkeySwings and position building
We have witnessed a tremendous amount of profit taking after clearing the 7.23 targets in USDTRY and are arriving back into major support territory. The pick-up in local activity was notable as banks were forced to defend the TRY. Many clients I speak to are happy to continue buying USDTRY , the picture looks gloomy for Turkey and real money continues to sit on the bid.
On the monetary side, the CBRT cutting by 50bps was widely expected although wont make much difference at this stage. EM FX will remain under pressure if we see a broad risk-off environment this week. Keeping a close ear to the wires for any updates on swap lines, those looking for positioning in USDTRY should always think about loading in a safe place. Such a shelter will render us a superb shelter when the storm hits shore...
A massive 30% macro swing after an obvious mistake from Erdogan. Turkey will remain sluggish until they expose the issues underneath, the correct idea would be to put pressure on CBRT which is what markets are doing and show no signs of stopping in the Short-term. Here 7.80 would be the measured target in the shelter then profit taking can begin again.
As with any swing, it is important we assess the downside to see if we find something which is to our advantage. The dollar devaluation is the only technique that the Fed can construct, the only defence left in the toolkit is -ve rates and like a scout putting up his tent we must prepare. Depending on how quickly markets begin to price negative rates in USD, we may fail to complete the mission towards 7.80.
#USDTRY spotted in a Bear flag.Hey, I am back with another idea, this time looking at Forex pair of USD/TRY
USD/TRY pair has been spotted in a bear flag, which is considered as bearish formation, strong in downtrend and also as the EMA's are getting tighter, there is move likely to happen soon at this level.
I would short this pair at the resistance area.
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The recovery momentum of Turkish lira investorsThe recent rate cut from the Turkish central bank has stopped the recovery momentum of Turkish lira investors. As of writing, it’s seen that the pair is gradually gaining once again and this time, it’s believed that bulls will bring it back to its resistance. However, it’s still uncertain whether bulls will have enough strength to break the pair’s resistance as the Turkish economy gradually reopens. Meanwhile, late last week it was reported that the Turkish central bank eases its official interest rates, or otherwise known there as a one-week repo rate from 8.75% to just 8.25% as expected prior. Bullish investors of the pair immediately saw an opening to gain again following the central bank announcement. However, as the move was still in line with expectations, it didn’t cost major losses for the Turkish lira immediately. Economists are still warning that the consecutive rate cuts are putting intense pressure on the Turkish lira and the country’s economy.
USD/TRY SHORTBecause of MACD divergence, I expect the price go up to Fibonacci level of 50, then fall to the lowest point between the divergence .
How Will USD Bull Run Continue USD is
- still bullish,
- has consistent volume, buys are slightly increasing since the beginning of the year.
- made the bullish flag in previous year.
- hit the bottom of the uptrend channel that validates the target zone at the top of the channel.
- Turkish economy is still in fragile-five.
Correction to 6.70 (Fib Level 0.236) is possible. It is up to you to wait for that scenario.
Entry Zone : 6.70 - 7.00 TRY (Fib Level 0.236)
Target Zone : 9.00 - 10.00 TRY (Fib Level 0.786)
Stop : 6.40 TRY (Outside of the uptrend channel)
Expire Date : Mid 2021
Psychological Levels : 9 - 10 - 12.5
p.s. This is not a trade advice. Do your own research and take your own risks.
ridethepig | TRY Market Commentary 2020.04.29All eyes on risk markets and the recent rebound reaching its final stages of exhaustion. USDTRY not giving any gains back, continuing to attack the 7.00 important psychological resistance. Buyers calmly finishing their preparations for an appropriate welcome of the next risk headline, while local banks try everything they can to defend.
Happy to sit long USDTRY, if we do not see concrete measures around the Fed swap line then expect macro players to stick the knife into Turkey once more. There is little to see to the downside, I will actively look to add longs on any dips should we see them towards 6.90xx otherwise to the topside we have very very soft resistance at 7.00. A break above will open 7.235x and 7.80x main targets.
The move played is a demonstration of a winning macro one, the main line comes down to the pursuit of safety; capital is forced to flee a dictatorship, but the flight itself can be beset with difficulties as more and varied restrictions are conjured. Tread extremely carefully for those invested in Turkey.
Thanks as usual for keeping the support coming with likes, comments, charts, and etc!