Trade Idea (2020-11-05) Risk-on by “Divided Diet”

Trade Idea

Good morning.

Yesterday’s US stocks were almost all-high, and DJIA rose to over $800 temporally. The US presidential election is a closer battle than expected and the situation has not yet been decided, and it may be prolonged due to a court battle, but the Republicans make up majority of Senate, and Democratic Party make up majority of House of Representatives. Market was well received that the scenario of “Financial deterioration and rising interest rates due to Triple Blue” collapsed.

In foreign exchange market, USD buying was dominant in the Tokyo market, but USD selling was dominant in the London and New York markets. EURUSD temporarily fell to around 1.16 in the Tokyo market, but was repurchased in the London and New York markets, ending at 1.172. It has also been pointed out that if Mr. Biden becomes president-elect, EURUSD could exceed the milestone of 1.20. The MPC (Bank of England Monetary Policy Committee in UK) will be held today. As the second wave of infection spreads of COVID-19 and lockdown begins, it is expected that the target amount of asset purchase quota will be expanded.

Wisconsin, Michigan, and Pennsylvania were the Democratic grounds before the last election, but they became “The states that made Trump president” in the last election because the Democratic Party was opposed to promoting the TPP at that time. What will happen this time?

EURUSD H1 (Please click the chart to enlarge.)

Market Environment

Yesterday’s currency strength

US market yesterday

DJIA: 27,847.66 (+367.63, +1.34%)
NASDAQ: 11,590.78 (+430.21, +3.85%)
S&P 500: 3,443.44 (+74.28, +2.2%)
GOLD: 1,907.9 (+11.7 +0.617)
OIL: 38.66 (-0.49)
US 10-YR: 0.74 (-0.028)
VIX: 29.57 (-5.98)

Asian market today

Nikkei: 23,968~ (+263)
CME Dow future: 27,796~(-51 Dow)

Economic indicators today

Counting of US presidential election
GMT 00:30 (AU) Trade balance
GMT 07:00 (UK) BOE policy interest
GMT 07:00 (UK) BOE inflation report
GMT 07:30 (UK) BOE Governor Mr. Bailey Press Conference
GMT 13:30 (US) New Jobless Claim
GMT 19:00 (US) FOMC
GMT 19:30 (US) Fed Chairman Powell Press Conference