FXStreet (Edinburgh) - The Turkish lira has rapidly gathered traction after the ruling AKP party won the elections on Sunday, taking USD/TRY to 3-month lows in sub-2.76 levels.
USD/TRY weaker on Erdogan win
The AKP party has obtained a convincing and unexpected victory with nearly 50% of the votes at yesterday’s national elections in Turkey. President R.Erdogan will now have parliamentary majority with 325 seats out of 550, returning to a single-party government.
TRY has strengthened to levels last seen in early August just below the 2.76 handle vs. the greenback in the wake of the results, although it has given away part of those gains afterwards.
“Although surprising to most, AKP sweeping win and the resulting fast-track (and long-overdue) formation of a stable government could allow a short-lived test of the 200dma of 2.72 in USDTRY, and further outperformance relative to its high yielding peers (notably ZAR)”, noted Strategist at Societe Generale Roxana Hulea.
USD/TRY levels to consider
At the moment the pair is retreating 4.66% at 2.7795 facing the next support at 2.7310 (200-day sma) followed by 2.6723 (50% Fibo of 2.2691-3.0754) and then 2.6240 (low Jul.14. On the other hand, a surpass of 2.8853 (23.6% Fibo of 2.2691-3.0754) would aim for 2.9568 (55-day sma) and finally 2.9640 (high Oct.14).
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