CannonScout replies to: USD/TRY

daily, 4h and 1h charts looks very bullish..we may test 4.70 and above..we haven’t seen any significant pullback after inflation data, despite Usd index drop today..Usd index can cause some directioanl confusion in following days..

yearly inflation is 15.39% now and it was 12.15% last month..Central Bank main interest rate is 17.75% now..

so, real interest rate is 2.36% now comparing to 5.60% before data (according to last month inflation)..

real interest rate of 2.36% is still quite high comparing to other countries (icluding both developed and emerging) but due to fundamental problems and political risks, probably there will be rate increase expectations…next Central Bank meeting is at 24 July..but the problem is interset rate has been increased already too much, there will be growth problem in the second half of the year..so, another increase may worsen growth issue..with worsening growth expectations, foreign and local investors may exit from Stock Market…looks very gloomy and doomy..

on the other side, Usd index has dropped today and weekly chart suggests some more drop possible..as i shared before, i expect some correction in Usd index in summer season and resuming up trend again near september..so, if Usd index continue to its correction in coming weeks, it will limit usd/try up movements to some extent and may cause some range trading..and when Usd index will resume its uptrend strongly, Usd/try may go to the sky..

Attached Images (click to enlarge)

make your own anlaysis and decisions..just giving some perspective..

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