USDTRY
USDTRY gives up 0.21% at 5.7326 registering loses for fourth consecutive trading session. The Unemployment rate in Turkey increased to 14.0% in August from 11.1% in the same month of the previous year. It was the highest jobless reading since March. Turkey’s inflation rate dropped to 8.55% in October from 9.26% in September. That was the lowest reading since December 2016. Turkish Exports climbed from previous $14.44B to $15.66B in October supported by weaker Turkish lira.
On the other side of the equation on Friday the Empire Manufacturing for November came in at 2.9, below expectations of 6.0. Advance Retail Sales for October rose 0.3%, beating the expected 0.2%, while Retail Sales Less Autos for October fell 0.2%, below forecasts of 0.4%.
The central bank of Turkey cut interest rates by 250 basis points, above the analyst’s expectations, to 14% in October 24th. CBRT delivered in its previous meeting a 325bp interest rate cut to 16.50% more than markets expected. CBRT slashed borrowing costs by 7.5 percentage points since July in an attempt to revive growth.
On the technical analysis side, USDTRY short term outlook is neutral now after the correction from three-month highs, as the pair trades below the 50-day moving average and above the 100-day moving average. The rally from 5.45 August 8th lows stalled mid-October at 5.94. USDTRY accelerated the upward move after the price pierced the descending trendline from May 23rd. On the downside first support stands at 5.7303 today’s low, while more buying support will emerge at 5.7093 the 100-day moving average.
On the upside, first resistance for USDTRY stands at 5.7461 today’s high while a break above might push prices for a test of the next resistance at 5.7540 the 50-day moving average. Patient traders may wait for a break of the 100-day moving average to enter a short position or a break above the 50-day moving average to initiate a long position.