Gold, Stocks, Bonds and USDMXN
There are some leading indicators from the markets that will help tell the election story (or is it the news moves the market?) Anyway, we will be watching. Here is the current breakdown.
Spot Gold
Spot gold rallied higher last week - moving above the 200 day MA and nearly reached the 100 day MA (currently at 1315.53). Then the weekend came, the FBI email proclamation came out saying Clinton would not get in trouble, and it has been a break the other way.
The price today has moved below the 200 day MA at 1279.09. The precious metal is trading at 1276. So it is back below that key MA.
Political Lean: Clinton. Lower gold is a vote for less flight into the relative safety of the precious metal.
Stocks
The US stock market is just closing and the S&P 500 and the index closed at 2139.53. That is below the a key technical level at the 2146.50 area. Why is that so important? The 50 and 100 day MAs are at that level. What was the high for the day? 2146.87 just above the key MA levels. Although we went up to the MA levels, the sellers leaned - keeping a lid against the level.
Political Lean: Little Clinton. Why a little? The S&P moved higher. If it were Trump, the S&P would be down big. It is up. However, it failed to get above the 50 and 100 day MAs. Also more Clinton is the low on Friday based against the 200 day MA. That gives Clinton an edge as well.
Bonds
If Clinton wins, the Fed will likely have a green light to tighten which should raise rates. On the opposite extreme, a Trump victory would likely lead to a flight in to the safety of the US treasuries.
Political Lean: Clinton. The 10 year year bond yield is up about 4 basis points. It is below the high but still higher. Technically, the yield has moved above the 50% retracement of the move down from the November high at 1.8464% level. The current yield is at 1.8672%.
USDMXN
The USDMXN has been falling below trend line support today, and the 50% retracement at 18.48316. We just fell below the 200 day MA at the 18.39760 level and trades at new day lows.
Political Lean: Clinton. Of any currency that would be impacted the most by a Trump victory would be the MXN. It would have melted. It is not melting. It is getting stronger. The fall below the 200 day MA suggests the market is feeling pretty good about a Clinton victory.
For other technical reviews outlining key levels and explaining why....
Commodity currencies moving higherThe USDJPY's big technical picture into the US election results
Isn't it about time the EURUSD got out of this quagmire?