Turkish lira stands at the back foot ahead of CBRT rate decision on Thursday

The Turkish lira remains in defensive mode for the second day as dollar bounced on lowered expectations for Fed’s 0.5% rate cut.
The pair dipped to 5.5977 on Friday,  to cover the gap from 8 July when lira fell sharply after the CBRT governor was fired and approached key supports at 5.5828 (4 July low);  5.5740 (Fibo 61.8% of 5.1595/6.2445) and 5.5672 (200DMA).
Lira needs clear break here to signal fresh strength and extension of rally from its 2019 low at 6.2445.
Initial resistance lays at 5.6907 (20DMA) but stronger bullish signal can be expected on extension above 100DMA (5.7629).
The Central Bank of Turkey meets on Thursday, with market expectations for 1% – 5% rate cut (2.5% cut is seen as likely scenario) as traders expect rates to fall to 15%-20% levels by the end of the year (from current 24%) to come more in line with inflation (currently at 15.7%).

Res: 5.6907; 5.7337; 5.7629; 5.7845
Sup: 5.6411; 5.5977; 5.5828; 5.5740