EUR/USD Surged With Stocks on Election Polls, Fiscal Stimulus Hopes
2020 Election, EUR/USD, Stock Markets, Fiscal Stimulus - Talking Points
- Biden surging in the polls despite Trump returning to the White House
- Hopes of coordinated fiscal stimulus may be driving market sentiment
- EUR/USD trading above key range – where might its gains be capped?
29 DAYS UNTIL THE US PRESIDENTIAL ELECTION
Markets now have less than 30 days until the 2020 US presidential election and the polls continue to show former Vice President and Democratic nominee Joe Biden in the lead. While President Donald Trump has been discharged from Walter Reed National Military Medical Center, his infection with Covid-19 has damaged his standing in the polls. Mr. Biden appears to now be polling above his 7-point average.
2020 US Election Polls
Markets appear to be welcoming the Democratic candidate more perhaps because of the potentially less uncertainty his administration would bring to global affairs, especially as it relates to trade. Market sentiment may also be getting lifted by investors pricing in a Democratic sweep in the upcoming election season, potentially opening the door to more governmental coordination.
This could mean fiscal stimulus passing with greater ease whether it’s another coronavirus package of infrastructure spending. Either way, both could brighten the outlook especially with a growing emphasis on fiscal stimulus rather than monetary. As the election continues to unfold, polling data may start to more clearly impact market mood but could punish haven-linked assets like the US Dollar and Treasuries,
EUR/USD Price Analysis
EUR/USD is now again trading above a key inflection range between 1.1698 and 1.1720 after briefly puncturing below it in late September. This now opens the door to retesting potentially trend-defining resistance at 1.1936 and 1.1965. EUR/USD may boldly rise until that point where traders’ resolve will be tested in terms of their confidence of the pair’s upside potential.
EUR/USD - Daily Chart
EUR/USD chart created using TradingView
--- Written by Dimitri Zabelin, Currency Analyst for DailyFX.com
To contact Dimitri, use the comments section below or @ZabelinDimitri on Twitter
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.