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No real news concerning the presidential elections yet – Market Overview – November 6

No real news concerning the presidential elections yet – Market Overview – November 6

Today the stock markets have decided to break from their bull run of the last three days.

It can be considered that this is just technical profit-taking at the end of the week; nothing has changed from a fundamental perspective.

The vote count continues in the United States with an advantage for Biden, and although everything indicates that the process may be extended due to legal confrontations, the market anticipates a Democratic victory with positive effects, as shown in yesterday's analysis.

At the moment, Dowjones30 oscillates between profit and loss, but the relevant rally experienced this week anticipates future rises on the way to its resistance level at 28840 points.

The economic figures, for the moment, stay in the background

Today the North American employment figure has been published with a non-farm payroll growth of 638k vs. 600k expected and an improvement in the unemployment rate of 6.9% vs. 7.7% of the previous month.

The Dollar reacted slightly to the upside after the publication, but it has immediately reversed this rally, resulting only in algorithmic trading systems that respond to the news.

This indicates that the Dollar's downtrend will remain firm for the simple reason that the Federal Reserve, as its president Powell told yesterday, will continue with its ultra-expansionary policy, with historically low-interest rates and with its purchase of assets.

This will be the case regardless of the electoral results and could intensify if a sufficient Democratic majority is not achieved in the Senate to approve a stimulus package in the short term. In this case, it is possible that the Fed's action would increase the downward pressure on the US currency.

Dollar vs Peso

An evident proof of this trend is found in the price of the Mexican Peso against the Dollar.

USD/MXN has broken down the critical support level of 20.85 and is trading at lows not seen since last March.

Below this support level and in the event of a daily and weekly close as it could be today, the pair would head towards the lows before the pandemic in the 19.00 area.

An important factor that influences the strengthening of the Mexican Peso, regardless of the Dollar's intrinsic weakness, is the increasingly certain victory of Biden.

As we all know, President Trump has maintained a policy of open hostility with his neighboring country; a policy change would favor Mexico's trade relations with the United States.

Update: On November 9, 2020, the USA 30 was nearing an all-time high, closing in the 30k mark.

Maklumat/penyelidikan ini disediakan oleh Miguel Ruiz (“tpenganalisis penyelidikan”) dan tidak mengambil kira objektif pelaburan tertentu, keadaan kewangan atau keperluan khusus individu. Penganalisis penyelidikan bertanggungjawab terhadap kandungan laporan penyelidikan ini, samada sebahagian atau keseluruhannya, memperakui bahawa pandangan mengenai syarikat dan sekuriti mereka yang dinyatakan dalam laporan ini jelas mencerminkan pandangan peribadi dan pedagang bertanggungjawab sepenuhnya ke atas risiko mereka sendiri.

Penyelidikan yang disediakan bukanlah pandangan JME Financial Services (Pty) Ltd ataupun undangan untuk melabur dengan JME Financial Services (Pty) Ltd. Penganalisis penyelidikan juga memperakui bahawa tiada sebahagian daripada pampasannya, adalah, atau akan, secara langsung atau tidak langsung, berkaitan dengan cadangan atau pandangan tertentu yang dinyatakan dalam laporan ini.

Sehingga tarikh laporan diterbitkan, penganalisis penyelidikan dan pasangannya dan/atau saudara-mara yang bergantung kepada penganalisis penyelidikan, tidak memegang kepentingan dalam sekuriti yang dicadangkan dalam laporan ini (“kepentingan” termasuk pemilikan langsung atau tidak langsung terhadap sekuriti).

Penganalisis penyelidikan tersebut bukanlah di bawah JME Financial Services (Pty) Ltd. Anda digalakkan mendapatkan nasihat daripada penasihat kewangan bebas mengenai kesesuaian pelaburan, di bawah penglibatan berasingan, seperti yang anda anggap sesuai dengan objektif pelaburan tertentu anda, keadaan kewangan atau keperluan kewangan tertentu sebelum membuat komitmen untuk melabur.

Undang-undang Republik Afrika Selatan akan mengawal sebarang tuntutan yang berkaitan dengan atau yang timbul daripada kandungan maklumat/ penyelidikan yang disediakan.