USD/TRY set to tick down towards the 8.00 level – SocGen

USD/TRY has experienced a sideways consolidation after facing resistance near 8.80 in June. The pair has set a head and shoulders pattern and may see a sharp decline towards the 200-day moving average (DMA) near the 8.00 region, economists at  Société Générale brief.

Break above 8.74 needed to negate head and shoulders pattern

“USD/TRY has formed a Head and Shoulders pattern which points towards potential downside. This is also highlighted by daily MACD which has dipped within negative territory.”

“In case the pair breaks the neckline at 8.26, a deeper pullback could materialize towards next potential objectives at 8.16 and the 200-DMA near 8.01.”

“A move beyond 8.74 will be essential to negate this pattern.”