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Markets Freaked Out About the US Election, Then Loved It. What's Next?

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ticker lesson

Breakdown

0:09lesson

Market reaction to US election

  • Election results caused dramatic market moves
  • Uncertainty around political deadlock
  • Fiscal policy entanglement
  • Market relief from event risk removal
2:50S&P· ticker

S&P 500 reversal and structure

  • S&P had violent reversal overnight
  • Markets initially sold off due to blue wave
  • Rally reflects event risk removal
  • Highs still lower than October tops
  • Lows still lower than October lows
5:25NASDAQ· ticker

NASDAQ technical levels and weakness

  • NASDAQ had initial sell-off
  • Bounced back to positive territory
  • Technical levels now act as resistance
  • Market stalling at these levels
8:00Crude oil· ticker

Crude oil selling off and speculation

  • Crude oil selling off aggressively
  • Speculation about US-Iran war ending
  • Market trying to carve out reversal
10:13Gold· ticker

Gold rally and critical range

  • Precious metals post formidable rally
  • Turn secured overnight
  • Testing critical range lows
  • Short-term charts show queasiness
12:59Silver· ticker

Silver rally and critical range

  • Silver also rallied
  • Testing critical range lows
  • Short-term charts show queasiness
15:38Bitcoin· ticker

Bitcoin bounce and resistance

  • Bitcoin managed heroic bounce
  • Hit former support turned resistance
  • Potential for higher push
15:39EUR· ticker

Euro attempting to bottom

  • Euro attempting to bottom
  • Clawing its way higher
15:40GBP· ticker

GBP strength and resistance

  • Pound stronger despite rate decision
  • Testing resistance level
15:41AUD· ticker

AUD long position and dollar dominance

  • Australian dollar shows strength
  • US dollar reasserts dominance
  • Long position remains intact
15:42CAD· ticker

CAD weakness and divergence

  • Canadian dollar uniquely weak
  • Divergence in market response
  • Anticipates special difference in trade negotiations
15:43lesson

Economic data and market engagement

  • Economic data becoming interesting post-election
  • ISM services numbers weaker than expected
  • Second consecutive month of decline
  • Weaker counter to manufacturing data
15:44lesson

GDP and economic structure

  • Consumption is largest part of GDP
  • Investment outpaces consumption in GDP
  • Expensive imports offset consumption gains
  • Data center boom as main driver
15:45lesson

Fed policy and market positioning

  • Fed policy odds unchanged post-election
  • One hike by January fully discounted
  • Another hike by June fully discounted
  • Market positioning remains cyclical risk
15:46AUD· ticker

AUD long position and profit taking

  • Still long AUD against USD
  • Flipped on CAD, now slightly short
  • Still long Bitcoin
15:47SPY· ticker

SPY short position and put verticals

  • Still short stocks via SPY
  • Put verticals on SPY
15:48TLT· ticker

TLT long position and call verticals

  • Still long bonds via TLT
  • Call verticals on TLT

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