USD/TRY opened Monday at 45.8862 and closed Friday at 46.0765, marking a 190-pip advance or 0.41%. The pair printed its weekly high at 46.0765 on Friday and found support at 45.8656 early Monday. Trading volume averaged 39,374 contracts daily, with Thursday seeing the heaviest activity at 48,389 contracts.
The Turkish lira joined a broader emerging market selloff that accelerated Thursday. South Korean markets led the rout with the KOSPI index dropping sharply and the won hitting 17-year lows against the dollar. The contagion spread across EM currencies as traders repositioned for higher US rates.
China's central bank set its USD/CNY reference rate well above estimates on Thursday, signaling tolerance for yuan weakness. This defensive stance from the PBOC reinforced the risk-off tone that pushed USD/TRY through the 46.00 psychological level.
No major Turkish economic releases are scheduled for the coming week. Without domestic catalysts, USD/TRY will track broader emerging market sentiment and dollar strength. If EM stress continues and the dollar index pushes higher, the pair could test 46.20. Should risk appetite return and EM currencies stabilize, support at 46.00 becomes the first test.
The 46.00 round number now acts as the first support after Friday's break higher. If this level holds on any pullback, the weekly high at 46.0765 becomes the immediate resistance, with 46.20 as the next target. A close back below 46.00 would bring the weekly low at 45.8656 back into focus, with 45.80 as deeper support.
Byline: LHFX Research
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