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Turkish lira trading by Reuters

© Reuters. FILE PHOTO: A currency exchange holds Turkish lira banknotes in Ankara, Turkey, on September 27, 2021. REUTERS / Cagla Gurdogan

By Saikat Chatterjee and Karin Strohecker

LONDON (Reuters) – The Turkish lira suffered a historic 15% drop on Tuesday in a session of thin trading volumes and declining liquidity, and gauges are showing more astonishing times.

Below are four charts that represent a lira’s individual day trading.


The number of trades fell sharply when the pound fell below $ 13.45 on Tuesday, as last week’s data showed. The number of deals peaked during that period, when the lira stood at less than $ 10.

Changes in low-volume prices are a classic sign of a market freeze, as market makers shy away from offering commercial liquidity to trade at available prices while end-users are terrified.

Chart – Lira Trading:

Graphic – Lira volumes:


Implied volatility measures of the lira / dollar – indicating expected fluctuations – peaked in Turkey’s 2018 currency crisis on Tuesday. The lira reversed some losses on Wednesday as it saw only a small delay in implied volatility, showing that investors are betting on further changes in the future.

Derivatives markets indicate a lack of liquidity in the option, as traders are moving away from large directional bets, exacerbating price changes.

Chart – Lira volatility:


The volatility of the lyre is unlikely to end any time soon. Market gauges for long-term volatility measures of the lira suggest that traders expect a rocky path. One-year implied volatility indicators are showing the largest gap since 2018 compared to one-month maturities.

Graphic – Lira volcurve:

Note: Fusion Media We would like to remind you that the data collected on this website is not necessarily real-time or accurate. Not all CFDs (stocks, indices, futures) and Forex prices are provided by exchanges, but by creative markets, so prices may not be accurate and may differ from actual market prices, i.e. prices are significant and not suitable for trading purposes. Therefore, Fusion Media does not assume any responsibility for any commercial losses you may suffer as a result of using this data.

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