The external news flow is playing out against the USDTRY pair. At issue is the souring of relations between the US and Turkey over the Armenian genocide under the Ottoman Empire during World War I. The question boils down to whether or not US President Joe Biden recognizes the massacre of Armenians during this period as genocide.
In addition, the market was rattled by remarks from Turkish President Erdogan about the possibility of selling more foreign currency reserves if necessary.
USDTRY is currently trading at 8.3535, off yesterday’s intraday high of 8.3570. The pair could rise to the 8.3570-8.3580 band if the genocide controversy persists and Erdogan continues to engage in the same belligerent dialog with the opposition.