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Several risk assets are advancing, notably Gold which is advancing strongly to new record prices, while Bitcoin and US stocks also trade bullishly near all-time high prices.
With less than 1 week to go before the close of polls in the US election which will see the states and voters choose a new President and Congress, the “Trump Trade” is gaining as polls and betting markets continue to suggest a narrow Trump victory is the more likely outcome, although it is worth noting the polls are very close and well within their statistical margins of error. The Trump Trade is broadly long Bitcoin and US stock markets, and to some analysts, also Gold. Gold is the standout asset in the market right now as it continues to advance powerfully to new record highs, and it is showing no sign of stopping. Bitcoin advanced powerfully earlier this week but is now making a small bearish retracement after coming within $100 of its record high price which it made last March. Major US stock indices like the Nasdaq 100 and the S&P 500 have risen and are currently also trading near their respective record highs. Trend traders will be interested to be involved here, but if Trump’s small poll lead evaporates or an event happens that is very negative for Trump before election day, it may push these prices down. However, it should be noted that Trump’s very narrow poll lead is not the only reason these assets are rising.
Precious metals stand out, with Silver rising strongly as well as Gold yesterday. Palladium has also recently reached a new high price. Palladium futures are expensive but there is a Palladium ETF which is affordable.
With just one week to go to the US Presidential Election on 5th November, polls suggest a narrow victory for former President Donald Trump is the likely outcome. However, almost all polls from the swing states are showing Trump and Harris so close that anything could happen, as the numbers are well within the margin of sampling error. Betting markets suggest Trump’s chance of victory is about 64%, while pollster 538 has Trump’s chance at 52%. The rolling average of polls by 538 is showing Trump narrowly ahead in Pennsylvania which would secure him victory assuming that he wins Arizona, Georgia, and North Carolina, where he is also ahead, but by no more than 2% in any of them.
In the Forex market, the New Zealand Dollar is the weakest major currency and the Euro the strongest since the Tokyo open, but the numbers are low enough to be almost meaningless.
There were two items of key US economic data released yesterday:
- CB Consumer Confidence – this came in notably stronger than expected, and helped boost stock markets and risky assets.
- JOLTS Job Openings – this came in lower than expected.
Australian CPI (inflation) data released earlier today came in lower than expected, falling from an annualized rate of 2.7% last month to 2.1% this month, lower than the 2.3% which was widely expected. This has helped weaken the Australian and New Zealand Dollar somewhat, but not by much.
There are a few highly important data releases due today:
- US ADP Non-Farm Payrolls Forecast
- US Advance GDP, which is expected to remain steady on the previous number at 3.0%. A higher number could help boost US stock indices and Gold.
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