JP Morgan Adjusts its Expectations

The Turkish Central Bank had raised interest rates from 8.5 percent levels in early June to 25 percent levels at the end of August.

Risk 0.50%.

• Entering a buy deal with a pending order from the 25.35 level.
• Place a stop loss closing point below the 24.95 level.
• Move the stop loss to the entry area and follow the profit as the price moves by 50 points.
• Close half of the contracts with a profit equal to 70 points and leave the rest of the contracts until the strong resistance level at 27.00.

• Entering a sell deal with a pending order from the 27.00 level.
• The best points to place a stop loss are closing the highest level of 27.65.
• Move the stop loss to the entry area and follow the profit as the price moves by 50 points.
• Close half of the contracts with a profit equal to 70 points and leave the rest of the contracts until the support level of 25.70.

The USD/TRY rose slightly during early trading on Tuesday morning, as pressures on the Turkish currency expanded after inflation data issued yesterday, at the same time investors followed the US bank JPMorgan’s amendment to its previous inflation expectations in Turkey until the end of the year. Currently, the US Bank raised inflation expectations in Turkey by the end of 2023 to 65 percent, compared to its previous expectations of 62 percent. This is after inflation data published yesterday, Monday, revealed that inflation in the country rose to 58.9 percent on an annual basis last August, compared to an inflation rate of 47.8 percent during July, which rose from 39 percent during June.

Turkish Finance Minister Mehmet Simsek commented that his country will tighten monetary policy and restrict credit and income policies in order to control inflation rates that are recording expansion. The Turkish Central Bank had raised interest rates from 8.5 percent levels in early June to 25 percent levels at the end of August. Among a number of other measures, the most important of which was reducing lira deposits protected from foreign exchange rate fluctuations.

In other data, Turkish exports recorded a significant jump last August on an annual basis, after Turkish exports reached their highest levels ever at $21 billion, rising by 1.6 percent.

On the technical level, the dollar pair against the Turkish lira rose slightly, as the pair is heading to retest the lower border of the ascending price channel on the four-hour time frame, which it broke during the last week after settling within it for several weeks. If the pair rises, it targets the resistance levels concentrated at 26.90 and 27.50, respectively, while if the pair declines, it targets the support levels concentrated at 26.00 and 25.70, respectively.

The price is moving above the 50, 100, and 200 moving averages on the daily time frame, while the pair is trading between these averages on the four-hour time frame, as well as on the 60-minute time frame, indicating the divergence that the pair is recording in the short term. The pair is expected to record some gains, targeting retesting the lower border of the price channel that the price broke before resuming the decline. Please adhere to the numbers in the recommendation, while maintaining capital management.

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