PRICES CONTINUE TO SQUEEZE IN EURTRY
The relatively weak overall euro assets prevented the upside attacks in the parity, while the positive news flow in the UK did not affect the Euro assets. Turkish lira assets, on the other hand, remained weak due to the tension between the US following the S-400 developments. However, the pair appears to be pushing the support of 6.33, the 200-day exponential moving average. Also, it is possible to say that the increase in the dollar assets after US President Trump's statements put the Euro side under pressure.
While the outlook in the Eurozone is slightly calm this week, the growth rate will be announced tomorrow and activity may increase. However, creating today's most important agenda of the talks will be held between US President Trump and President of Turkey Recep Tayyip Erdogan. Turkey risk premium (CDS) while involved in a form of downward movement visibly, the most curious details of the bilateral meetings between the United States may decide to implement sanctions it plans to Turkey. While this situation is important on the pricing of Turkish Lira assets, we see that Turkish Lira positively differentiated within the currencies of developing countries before the meeting.
Looking at the technical outlook of the EURTRY parity, closures below the 6.33 level of the 200-day exponential moving average are expected to accelerate the withdrawals in the pair. Thus, the parity may decrease by up to 6.25 support. However, in the short-term outlook, we follow the resistance of 6.30 due to the returns coming from this level at 6.33.