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USDTRY Market Update

12/22/2022 10:28 AM

This week, the USD/TRY pair is growing slightly, keeping the usual price range with an upper limit of 18.6800.

The "bullish" activity remains low as traders are in no hurry to open new positions ahead of the Christmas holidays. Also, the USD Index has been showing a clear downward trend over the past few weeks, which was provoked by growing expectations of monetary easing by the US Federal Reserve and other global regulators: in December, the US interest rate increased by only 50.0 basis points, interrupting the four-time increase session by a record 75 .0 basis points. At the beginning of next year, experts expect an increase in the indicator by 25.0–50.0 basis points, after which the agency is likely to take an observant position.

The lira remains under pressure amid a deepening inflationary crisis as the Central Bank of the Republic of Turkey cuts interest rates to find ways to keep the national currency's value. An earlier report from the regulator reflected a noticeable decrease in the volume of investments in the country: direct investments decreased by 1.2% to 139.9B dollars compared to the end of last year, while portfolio investments lost 10.1%, reaching 86.8B dollars.

President Recep Tayyip Erdogan noted that Turkey hopes to get rid of energy supplies from abroad by developing a new gas field in the Black Sea and launching the first Akkuyu nuclear power plant. According to him, large-scale measures have been taken to bring the installed capacity for domestic and renewable energy sources to 65.0%, and gas is now available to residents of 81 provinces. Earlier, Turkish and Russian leaders agreed to create an international gas hub in the republic, the participants of which will determine the prices for this resource.

On the daily chart, Bollinger bands demonstrate flat dynamics: the price range slightly expands from above, letting the "bulls" renew local highs. The MACD indicator is growing, keeping a poor buy signal (the histogram is above the signal line). Stochastic approached "80" and tries to reverse into a horizontal plane, signaling in favor of the development of a corrective decline in the next time intervals.

Resistance levels: 18.6815, 18.7500, 18.8500, 18.9000. | Support levels: 18.6390, 18.6000, 18.5000, 18.3737.

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