- USD/TRY breaks to the downside but holds well above confluence support.
- CBRT stands pat at 14% this month, ends strings of interest rate cuts
- Daily RSI still holds above 50.00 despite the latest downtick in the spot.
USD/TRY has returned to the red after the Turkish central bank’s (CBRT) no-rate change decision earlier this Thursday.
The spot is trading close to five-day lows of 13.26, gradually breaking lower, as the Turkish lira drew some support from the CBRT policy announcements.
The Turkish central bank kept the key rate steady at 14%, putting an end to strings of rate cuts, which sent the local currency into a downward spiral over the last year.
The major ignores the rebound in the US dollar alongside the Treasury yields after the US 10-year TIPS auction.
USD/TRY: Technical outlook
Looking at USD/TRY’s technical chart, the confluence of the bullish 21 and 50-Daily Moving Averages (DMA) at 13.05 will be a tough nut to crack should the daily lows give way.
A firm break below the latter will trigger a fresh downswing towards the upward-sloping 100-DMA at 11.00.
January lows of 12.76 could come to the rescue of bulls beforehand.
The 14-day Relative Strength Index (RSI) is trading listlessly, at the time of writing, although remains above the midline, keeping buyers hopeful.
Bulls need to find a strong foothold above the 14.00 threshold to negate the recent bearish momentum. The December 21 high of 14.14 will be the next relevant upside target.
USD/TRY: Daily chart
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