USDTRY at Eight-Month Highs After Fed Kept Rates Unchanged

Published by
Written By: Nikolas Papas
Share
    Summary:
  • USDTRY continues higher for the sixth consecutive trading session adding 0.33% at 5.9781. The rally that started since January 16th after the CBRT

USDTRY continues higher for the sixth consecutive trading session adding 0.33% at 5.9781. The rally that started since January 16th after the CBRT cut interest rates to 11.25% is intact. The 75 basis point cut was the smallest rate cut since the beginning of the easing cycle. That was the fifth consecutive interest rate cut since July 2019.

Yesterday the Fed kept the interest rates unchanged in 1.50%-1.75% range. Fed noted that the U.S. economy is growing at a moderate pace while the inflation remains subdued. Household spending is increasing while the investments in fixed assets remain weak. Fed Chair Powell warned that the coronavirus spread would hit China’s economy and that could spill in the USA as well.

In Turkey the economic confidence rises for the fourth-straight month in January, extending the highest levels since July 2018. The confidence index rose to 97.1 from 96.5 points in December.

Read our Best Trading Ideas for 2020.

USDTRY Technical Levels to Watch

USDTRY is 0.34% higher at 5.9789 hitting fresh eight-month highs. Bulls are in clear control of the pair as the price surpassed the 5.90 strong resistance. Funtamentals are also supportive as the interest rate differential gap increases.

On the upside, an immediate obstacle for the pair stands at 5.9817 the daily high. Next resistance level on the upside for the bulls is at 5.9910 the high from May 30th. The next supply zone awaits at 6.0507 the high from May 29th.

On the flipside, initial support for the pair stands at 5.9613 the daily low. If the USDTRY pair pierce that level the next critical support stands at 5.9325 the low from January 28th. The 50-day moving average at 5.8554 might cancel the bullish momentum if the pair breaks below.

Written By: Nikolas Papas

Technical analyst of forex, stock market indices and commoditiesTechnical analyst of forex, stock market indices and commodities Skills: Technical Analysis · forex · Stocks · Crypto · Writing

Published by
Written By: Nikolas Papas