Market Analysis

European markets opened in the red


The forecasted large victory of Biden has not arrived, and we are now looking at a narrow-victory for either candidate. It could take days, if not weeks, to have an official result coming from the US elections. In many states, votes postmarked by election day are also valid if received a few days after the election day, as long as they were mailed on time. The next few days are likely to prove highly chaotic. Uncertainty is not the scenario investors wanted and US futures initially turned sharply red before erasing most of those losses.

Carlo Alberto De Casa – Chief analyst, ActivTrades


We have seen the dollar strengthen and this has triggered some selling on the majority of commodities, including gold and silver. Investors are in risk off mode, but they are not yet buying gold. They are looking for clarity before taking positions, trying to predict what will be the next major movement for bullion.

Indeed, the gold spot price – after surpassing $1,900 – has now fallen again to $1,890. Technically we are still in the same lateral trading range of the last three months between $1,850 and 2,070. If we zoom in on the last few weeks, we have a first resistance placed at $1,910, followed by another one at $1,930. The key support zone of $1,850-$1,860 remains crucial for keeping gold in this lateral tendency.

Carlo Alberto De Casa – Chief analyst, ActivTrades

source: ActivTrader


European markets opened in the red this morning, alongside US Futures, as investors’ risk appetite is being shattered by the narrow results of the US presidential election. This is the worst scenario for investors as the close battle between the two candidates is likely to lead to contested results, with Donald Trump already saying he would go to the Supreme Court in the case of a Biden win, as well as a less legitimate President. In addition, investors expect the current uncertainty to weigh on markets for a bit of time, maybe days, as many states still have to count votes sent by mail prior to the election day. Finally, other strong market drivers will continue to add to the current uncertain trading stance with a slew of US data due out today before tomorrow’s policy decision from the Fed and Friday’s US NFP. Having said that, no clear directional trend is expected for the end of the week, but these major drivers are likely to exacerbate market volatility on a very short-term basis.

Pierre Veyret– Technical analyst, ActivTrades

source: ActivTrader


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