In the very immediate term EM FX will be hijacked by the ebb and flow of coronavirus headlines and the spillover effects on growth. Regular readers will know I have been a bear on Turkey for years, this environment will not attract any fresh RM inflows into Turkey - just take one look at the yields and the CBRT cutting cycle.
On the technical side, the breakout we traded unlocked 7.80xx for the year. Reassessment on the view is only required on a break of the 4th wave support located below at 5.4xx. The upside is wide open and will trigger the dominos in the collapse of Erdogan and Turkey as we know it.
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