"If he is released, it would be a major positive signal for the lira and should prove sufficient for USD/TRY to convincingly break below the support area around 6.00 towards the 5.6968 level," Piotr Matys of Rabobank said in a note to clients.
The case of Brunson, an evangelical Christian from North Carolina, has deepened tensions between the NATO allies, helping to send the Turkish currency down 40 per cent this year. He faces terrorism charges, which he denies.
NBC News reported that the White House expected Brunson to be released by Turkey and returned to the United States in the coming days, according to two senior administration officials and another person briefed on the matter.
NBC cited its sources as saying that under an agreement which U.S. administration officials recently reached with Turkey, Brunson is supposed to be released after certain charges against him are dropped at Friday's hearing.
The report could not be confirmed.
Brunson's lawyer told Reuters earlier that new prosecution witnesses expected to testify on Friday in his trial lacked relevance as their testimony will focus on incidents after his arrest.
Istanbul's main stock index was up 0.41 per cent, with shares in state lender Halkbank rising 3.3 per cent, having briefly dropped 6.2 per cent before a temporary suspension in trading.
A U.S. judge sentenced Halkbank executive Mehmet Hakan Atilla in May to 32 months in jail after he was convicted of taking part in a scheme to help Iran evade U.S. sanctions. The case is another source of Turkish-U.S. strains.
Turkey has dismissed the case as politically motivated and its finance minister has said he does not expect Halkbank to face any fine in relation to dealings with Iran.
(With inputs from agencies.)