S&P 500 Near Key Inflection Point With Election One Week Away
2020 Election, S&P 500 Analysis, 2020 Polls, Biden-Trump Spread - Talking Points
- US presidential election one week away – Biden continues to lead
- Rising Covid-19 cases sparking risk aversion and a flight to havens
- S&P 500 may challenge near-term support as selling pressure swells
7 DAYS UNTIL THE US PRESIDENTIAL ELECTION
It is officially one week out until the US presidential election as voters mail in their ballots amid a resurgence of Covid-19 cases and concerns of public safety. Early indicators have shown that record-breaking number of Americans – 22 million – have already sent in their votes. The surge appears to be a function both of the circumstances relating to the coronavirus and growing Democratic zeal to vote out President Donald Trump.
2020 US Election Polls
Joe Biden continues to lead in the polls ahead of the incumbent with a 7-point average that he’s held for a few weeks. The margins did narrow today but by a meager 0.5 points. Looking ahead, the Republican vote may surge on the election day itself if Republican-inclined voters opt to cast their ballot in person. This sudden spike may create some volatility and punish equity indices and push the haven-linked USD higher.
S&P 500 Analysis
The S&P 500 may retest a key inflection point at 3361.0 if accentuated selling pressure from swelling risk aversion amid the spike in Covid-19 cases drags the index lower. Breaking that floor could open the door to challenging frequently-tested support/resistance – depending on the month – at 3282.3. Encountering that zone could itself signal the start of a deeper pullback.
S&P 500 - Daily Chart
S&P 500 chart created using TradingView
Having said that, the fluidity and uncertainty of the situation as it pertains to the 2020 US presidential election and coronavirus makes the S&P 500 vulnerable to bouts of volatility.
--- 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.