In trading yesterday, the EURUSD fell to a lower trend line and found support buyers (see blue circle 3). The subsequent move to the upside, found sellers against/near the falling 100 hour MA. Traders leaned against the risk defining level (see falling blue line).

That hold against the moving average gave the sellers the go-ahead to push lower, and indeed they did in trading today. However they still needed to get below the lower trend line.

The price stepped lower and indeed, the pair fell below a lower trend line AND swing area near 1.1285 (see red and blue numbered circles).

That break now sets that area as topside resistance. Stay below 1.1285 is more bearish. Move back above, and there may be some covering/upside probing on the break disappointment.

On the downside, the pair is trading at the lowest level since December 23 and approaches the swing area between 1.1260 and 1.1263. A move below that level and it will open the door for traders to start to target the low swing area between 1.1226 and 1.1233. The low price from December 15 comes in at 1.12208.

Watching 1.1285 area for resistance. Sellers are more in control, but the technical break still needs to now keep a lid on intraday corrections. .

Going back to FX, EUR/USD is still caught around 1.1300 with large expiries holding close to the figure level today. Meanwhile, USD/JPY is also still toying with a potential break of 116.00 as buyers seek validation from the key risk event later. GBP/USD is holding just below its 100-day moving average at 1.3552 but above its key hourly moving averages at 1.3497-20.

As for commodity currencies, AUD/USD is pinned down around 0.7150-60 as sellers stay in near-term control in the hunt towards 0.7100. Large expiries at 0.7160 and 0.7200 are ones to take note of for today.

Meanwhile, we’re also seeing EUR/USD fall to a low of 1.1285 on the day and GBP/USD falling further to 1.3505 after failing to breach resistance from the 100-day moving average and 61.8 retracement level:

Despite the dollar’s advance, we are actually seeing equities pare some of its earlier losses. S&P 500 futures and Dow futures are now flat, but it is a bit early to call for dip buyers to prevail.

I still reckon we could see risk trades keep more pressured, especially if bond yields threaten to push higher. For now, 10-year Treasury yields are up 2.2 bps to 1.725% but facing resistance at 1.75% to 1.79% as outlined here.

Either way, it is tough to bet against the dollar so long as the Fed continues to play ball and risk trades are looking vulnerable. If anything else, the move so far this week could have more legs if the US non-farm payrolls release tomorrow vindicates the Fed in going with a quicker balance sheet runoff.

The Turkish Finance Ministry has announced their new measure (singular):

:: New deposit instrument to be used by individual investors, the minimum interest rate will be CBRT rate. In maturities of 3, 6, 9 and 12-months. If the FX change is above the CBRT rate, the difference will be paid in TRY to accounts.

:: The FX rate difference is to be calculated between TRY deposit account open/close dates; the rate will be announced every day at 08:00GMT/03:00EST by the CBRT.

This boils down to ‘guaranteed saving bonds’ – Though how “guaranteed” they are is anyone guess.

It’s certainly not the bazooka that is needed to fix the Turkish monetary woes.

The Lira hasn’t budged on the announcement, but it’s hard to imagine that Mr Market will see this as enough to quell the TRY weakness for long.