Credit: REUTERS/DADO RUVICOct 27 (Reuters) - Turkey's poor fundamentals have put severe pressure on the lira, causing it to break above the 8.0000, meaning USD/TRY could see a rise to near 9.0000 in the months ahead.
The lira weakened to a record low against the dollar on Tuesday as Ankara's relations with its Western allies soured and the central bank left its policy rate unchanged last week .
As the lira heads further into uncharted territory, a Fibonacci projection can be used when seeking to find levels the market might be aiming for. USD/TRY could reach 8.9865, derived from 100% of the move from the 3.3885 September 2017 low to the 7.2400 August 2018 high, projected from the significant November 2018 5.1350 base.
The lira's prolonged weakness has kept the technical outlook for USD/TRY bullish throughout 2020. That looks set to continue for the foreseeable future, especially as 14-month momentum has been positive for 10 months in a row.
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(Martin Miller is a Reuters market analyst. The views expressed are his own)
((martin.miller@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
