Highlights
Trump + Speculation = Trumpulation
The week ahead
Please note: All data, figures & graphs below are valid as of October 10th. All trading carries risk. Only risk capital you're prepared to lose.
Trading the Elections
The best indicator that we have, as far as the markets are concerned is the USDMXN. It's no secret that some of Trump's policies would be very bad for Mexico. For example, sending back Mexican criminals and building a wall between the US and Mexico and having them pay for it.
For anybody wanting to trade the elections, this looks like the best way to do it. So, let's take a look at the Peso chart during the time of the debate...
Remember, this is an inverse chart of the Peso so a move up means the US Dollar is gaining against the Mexican currency and Trump is hurting Clinton.
We can see that all the negative news, and horrible Trump recordings, that were heavily discussed in the media through the weekend created a huge gap in the price from the close on Friday to the opening on Sunday night.
In the above chart, the yellow circle represents the weekend gap and the blue square is the actual time of the debate.
Trump really went into this debate on the back foot but within the first 30 minutes he managed to diffuse Hillary's attacks and even rattle her cage a bit. Trump didn't need a win here, he just needed to stop the negative feedback loop that's been building against him in the media and by looking at the reaction in the markets it seems he may have just been able to do that.
The Week Ahead
Today is a bank holiday in Japan, Canada, and the United States.
Tomorrow there is relatively little scheduled on the economic calendar. However, there will be a few zingers later this week that could have a profound impact on the markets.
This content is for information and educational purposes only and should not be considered investment advice or an investment recommendation.
Past performance is not an indication of future results. All trading carries risk. Only risk capital you're prepared to lose.