TRY is comfortably the best............>

TURKISH LIRA: TRY is comfortably the best performer across EMFX Monday,

extending the recent rally to show below the 100-dma at 5.7099 for the first

time since late March. Support for the pair kicks in at the 5.5760 level (61.8%

retracement of the 5.1621-6.2457 move), which intersects with the 200-dma at

5.5903. The moves follow US President Trump softening his stance against Turkey

over the weekend, indicating that any sanctions or tariff pressure placed on

Turkey in response to their purchase of Russian S-400 missile systems could be

insignificant.

-While the reaction in spot USD/TRY has been enthusiastic, risk reversals have

barely budged, with the 1m measure holding well within last week's range,

although the curve has dropped across the short-end, with the 2m-4m sector the

biggest mover.

-The sentiment shift has clearly triggered one of the larger FX option trades of

the day crossing at the NY crossover: a 1x2 $180mln 5.58/5.34 six-month put

spread. The structure breaks even on a move below 5.5780.