FX.co ★ The collapse of the Turkish lira

Good afternoon, dear traders. Today, we will talk about a very unusual instrument that I periodically trade "from the foundation." This is the Turkish Lira, namely paired with the US dollar. Yesterday, looking through the news streams, I noticed Trump's statement at 16:56 London time, which sounded like this: "US President Trump threatened to "destroy the economy of Turkey" if this country does something that will go "beyond the borders."

We can guess for a long time whether this is connected with NATO military bases in Turkey, the purchase of missile defense systems from Russia, or something that we will never know, but from a speculator, it's not difficult to make money on this event.

Firstly, the Turkish lira immediately collapsed after such a message. And this is a normal reaction. But the fact is that USDTRY has one very important level for sellers at the quote of 5.58500, at which sellers can now limit their losses.

I recommend buying the dollar against the Turkish lira on pullbacks to update this level on the strongest foundation and exacerbate political tensions. Trump has never allowed himself such statements against Turkey, Erdogan, as you know, is an authoritarian man and will not "pull back" for a long time. This morning, there was a slight strengthening of the lira – I think this is due to the actions of Turkish financial institutions, but this pullback was quickly bought and the sellers had no chance.

Good luck with trading, and see you at the evening review!