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USD/TRY has witnessed a dramatic fall from record highs at the back end of 2020. Sinking to a 6-month low, prices now test the lower $7 region with momentum firmly resting to the downside.

Prices attempted to test the long-term resistance trendline recently, however could not puncture the level which is also a strong confluence of the Ichimoku cloud.

The price test at the cloud’s downside border indicates a descending tendency, which has negated the recent bullish divergence.

We now look towards targets below the $7 psychological level as bears confirm their stance.

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An intraday look shows that prices are firmly trading in a descending channel. With prices trading far away from the Ichimoku cloud, further downside is expected.

However, should price once again bounce off the lower channel, it could be a slight indication that in the near-term, the trend could be halted.

The recent bullish divergence could emphasize a turnaround.