- USD/TRY’s daily chart shows a falling wedge breakout, a bullish reversal pattern.
- The daily chart RSI is also reporting bullish conditions.
- The pair could test the immediate resistance at 5.77275 in the short-term.
USD/TRY is looking north, having breached a three-month-long falling wedge on the higher side on Monday.
The pair closed at 5.6557 on Monday, confirming an upside break of the falling wedge, represented by trendlines connecting May 9 and July 25 highs and June 5 and Aug. 8 lows.
A falling wedge breakout is a bullish reversal pattern, meaning the pullback from the May 9 high of 6.24579 has ended and the bulls have regained control.
The 14-day relative strength index (RSI) is also reporting bullish conditions with an above-50 print.
USD/TRY, therefore, looks set to test the resistance at 5.77275 (July 25 high). A close above that level would invalidate the bearish lower highs pattern and allow a rally to highs above 6.00.
The wedge breakout would be invalidated if the pair finds acceptance below Monday’s low of 5.56252.
Daily chart
Trend: Bullish
Key levels
Resistance: 5.77275, 5.9326
Support: 5.56252, 5.44947