Turkish lira maintains positive stance against US dollar in past couple of session and managed to retrace over 76.4% of 5.9053/6.2286 upleg on fresh extension lower on Thursday to one-week high at 5.9485. Weaker dollar on Wednesday’s US stocks meltdown came under additional pressure on weaker than expected US consumer prices in September. October USDTRY’s low at 5.9053 (lira’s highest since CBRT rate hike in Sep) is in focus and break here would open way towards key points at 5.8097 (daily cloud base) and 5.6875 (16 Aug), the highest of pullback of lira’s pullback from new record low at 7.1074. Bearishly aligned daily techs are supportive for further lira’s strength, but politics are expected to be the key driver again. Friday’s court hearing of imprisoned US pastor, who has been held for two years and case prompted US sanction on Turkey, could be the key event. Positive results on Friday (is pastor will be released) would have stronger positive impact on lira and prompt further recovery, while negative outcome would keep or increase tensions between the US and Turkey and bring lira under fresh pressure.

Res: 6.0318; 6.0565; 6.1164; 6.2163
Sup: 5.9485; 5.9053; 5.8097; 5.6875

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