EURUSD – Prices, News and Technical Analysis
- Further EURUSD weakness is expected with prior support now turning to strong resistance.
- USDTRY slips back after trading above 7.20 as Turkey readies plans to restore confidence.
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EURUSD Rattled at Fresh One-Year Low
EURUSD continues its journey lower as the Turkish Lira weakens further. Late last week reports showing EU bank exposure to Turkey rattled the single-currency and today’s fall – USDTRY hit a fresh all time low around 7.20 – compounded the problem. The Lira did rebound back below 7.00 after the Turkish Finance Minister Berat Albayrak said that the government had a plan to restore calm and that ‘institutions will take the necessary actions as of Monday morning’. This warning gave USDTRY a short-term bounce, but markets remain likely to sell the Lira into any strength, unless the Finance Minister’s announcement deters the bears. Last week a report in the Financial Times highlighted European bank’s exposure to the Turkish Lira, prompting a sell-off in the financial space.
Euro STOXX Bank Index (May 2016 – August 2018)
EURUSD currently trades below 1.1400 and may fall back to levels last seen over a year ago. Previous support levels at 1.1448 and 1.1554 now turn into resistance, while the next level of support – the 61.8% Fibonacci retracement of the January 2017/February 2018 rally – does not come into play until 1.1187. The pair trade below all three moving averages but have dipped into RSI oversold territory and may find a short-term reprieve before moving lower.
EURUSD Daily Price Chart (October 2017 – August 13, 2018)
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What’s your opinion on EURUSD and the Turkish Lira? Share your thoughts with us using the comments section at the end of the article or you can contact the author via email at Nicholas.cawley@ig.com or via Twitter @nickcawley1
--- Written by Nick Cawley, Analyst
