Early results in the U.S. presidential election indicate a lead for the Republican candidate.
A potential Trump victory is seen as favourable for the U.S. dollar, based on Donald Trump’s plans to:
→ increase tariffs on key U.S. trading partners;
→ stimulate domestic business and support small-cap companies.
Additionally, the Trump administration may influence the Federal Reserve’s rate policies, potentially leading to rate cuts as anticipated earlier.
The forex market has responded with a stronger U.S. dollar, especially against the euro.
On 21 October, an analysis of the EUR/USD chart indicated potential support from:
→ a major trendline (shown in blue);
→ the psychological level of 1.0800.
The price indeed rebounded upwards from this area (shown by an arrow), but recent news has sparked a bearish impulse, bringing EUR/USD below the key trendline today.
It’s possible this bearish momentum could continue, potentially keeping EUR/USD below the 1.0800 level.
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