The pair extends lower on Wednesday and broke below important support at 5.7875 (20DMA / 50% of 5.6370/5.9378) as lira was boosted by the latest Russia-Turkey deal on Syria. Lira’s advance is likely to be short-lived, as key factors that pressure lira – high inflation and Turkey’s economy in recession, remain in play. The CBRT is meeting tomorrow and expected to ease by further 1% but interest rates remain high. The price action stays above thin daily cloud, which reinforces support provided by Fibo 61.8% of 5.6370/5.9378, which needs to hold and prevent further weakness and confirmation of reversal. Broken Fibo 38.2% support now provides initial resistance at 5.8229 and guards upper pivots at 5.8477 (daily Tenkan-sen) and 5.8659 (21 Oct lower top) break of which will be bullish.
Res: 5.7874, 5.8092, 5.8229, 5.8477
Sup: 5.7737, 5.7577, 5.7518, 5.7418
