USD/TRY Hits Multi-Week Lows As Weak GDP Data Hurts Greenback

Summary:

Contrasting news for Turkey and the US help the USD/TRY pair to five-week lows, extending the corrective move on the pair.

The USD/TRY fell to five-week lows after conflicting data supported the Lira but hurt the greenback. On Thursday, the Bureau of Economic Analysis reported that the US economy grew by 6.5% in the second quarter of 2021, but this was slower than analysts expected (8.5%). Initial jobless claims also fell by less than was expected, dropping to 400K versus the consensus of 382K.

Conversely, Turkey’s Economic Confidence rose from 97.80 previously to 100.10 in July, boosting the value of the Lira. The contrasting news bits helped the USD/TRY towards a 1.15% drop on the day.

Technical Outlook for USD/TRY

Thursday’s selloff came off a rejection from the 8.57488 price mark, which has set the tone for price to target the 8.36986 support mark. Below this price mark, the 8.29080 and 8.19744 price marks serve as additional support levels.

On the flip side, recovery of the uptrend on the pair depends on the price breaking above the 8.74610 price mark. This allows the USD/TRY to form new highs that could target the 8.95736 mark (78.6% Fibonacci extension). This move would need to breach the resistance barrier at 8.57488.